Adams Systems is a U.S. multinational that just purchased €1 million of goods on account, due in 30 days from a French supplier. The spot exchange rate is $1.235/€, while the 30-day forward rate is $1.201/€. Adams is interested in hedging this account payable by using a money market hedge. If the 30-day periodic investment rate in France is 0.15 percent, how many U.S. dollars does Adams need to invest to properly hedge the account payable?
A) $1,199,201
B) $1,233,150
C) $1,236,853
D) $1,301,984
E) $1,314,923

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The Answer of Adams Systems is a U.S. multinational that just purchased €1 million of goods on account, due in 30 days from a French supplier. The spot exchange rate is $1.235/€, while the 30-day forward rate is $1.201/€. Adams is interested in hedging this account payable by using a money market hedge. If the 30-day periodic investment rate in France is 0.15 percent, how many U.S. dollars does Adams need to invest to properly hedge the account payable?
A) $1,199,201
B) $1,233,150
C) $1,236,853
D) $1,301,984
E) $1,314,923

Adams Systems Is a U