A U.S.export company scheduled to receive 1 million pounds six months from today can hedge its foreign exchange risk by
A) buying 1 million pounds in the forward market today for delivery in six months.
B) buying 1 million pounds in the spot market for delivery in six months.
C) selling 1 million pounds in the spot market for delivery in six months.
D) selling 1 million pounds in the forward market today for delivery in six months.
Correct Answer:
Verified
Q5: Which of the following tends to cause
Q6: Over time, a depreciation in the value
Q7: If Canadian speculators believed the Swiss franc
Q8: An appreciation in the value of the
Q9: A major difference between the spot market
Q11: Assume you are an American exporter and
Q12: Concerning the covering of exchange market risks,
Q13: Grain shortages in countries that buy large
Q14: A depreciation of the dollar refers to
A)
Q15: The exchange rate is kept the same
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