Question: 4. Face Co. uses the US dollar as its functional currency in Country X. At December 31, 2015 Face's subsidiary has a net asset position

4. Face Co. uses the US dollar as its functional currency in Country X. At December 31, 2015 Face's subsidiary has a net asset position in Country X of euro 100,000. Which correctly describes the action that Face will take on December 31, 2015 to hedge its euro exposure ? a. Face will enter into a spot contract to purchase euros and sell US dollars b. Face will enter into a spot contract to purchase US dollars and sell euros c. Face will enter into a forward contract to purchase euros and sell US dollars d. Face will enter into a forward contract to purchase US dollars and sell euros e. Face will purchase an FX option contract giving it the right but not the obligation to purchase euros and sell US dollars

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