If a firm based in the Netherlands wishes to avoid the risk of exchange rate movements, and is due to receive USD100,000 in 90 days, it could:
A) sell US dollars 90 days from now at the spot rate.
B) enter into a 90-day forward sale of US dollars for euros;
C) purchase US dollars 90 days from now at the spot rate;
D) enter into a 90-day forward purchase of US dollars for euros;
Correct Answer:
Verified
Q4: Assume that Patton Co. will receive 100,000
Q5: The potential effect of exchange rate fluctuations
Q6: Which of the following is not one
Q7: Operational techniques include:
A)diversification of a company's operations
B)purchasing
Q8: A(n) _ hedge protects the company from
Q9: Which of the following are rules to
Q10: An American firm has just bought merchandise
Q12: A forward currency transaction:
A)Sets the future date
Q13: Two important practical differences between the monetary/non-monetary
Q14: If the Indian subsidiary of a US
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