Which of the following reflects a hedge of net payables in British pounds by a U.S. firm?
A)Purchase a currency put option in British pounds.
B)Sell pounds forward.
C)Sell a currency call option in British pounds.
D)Borrow U.S. dollars, convert them to pounds, and invest them in a British pound deposit.
E)A and B

Question

Which of the following reflects a hedge of net payables in British pounds by a U.S. firm?​
A)Purchase a currency put option in British pounds.
B)Sell pounds forward.
C)Sell a currency call option in British pounds.
D)Borrow U.S. dollars, convert them to pounds, and invest them in a British pound deposit.
E)A and B

Quizplus · Accepted Answer

The Answer of Which of the following reflects a hedge of net payables in British pounds by a U.S. firm?​
A)Purchase a currency put option in British pounds.
B)Sell pounds forward.
C)Sell a currency call option in British pounds.
D)Borrow U.S. dollars, convert them to pounds, and invest them in a British pound deposit.
E)A and B

Which of the Following Reflects a Hedge of Net Payables