To hedge a payable position with a currency option hedge, an MNC would write a call option.

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To hedge a payable position with a currency option hedge, an MNC would buy a call option. Writing a call option would expose the MNC to potential unlimited losses if the currency moves against them. Buying a call option gives the MNC the right to buy the foreign currency at a fixed price, protecting them against unfavorable currency fluctuations.

To Hedge a Payable Position with a Currency Option Hedge