A U$.$S$.$ based firm is required to make a large payment, denominated in euros, six months from today related to the purchase of goods from a German firm recelved this past quarter, In order to hedge this currency exposure the US$.$ firm should:

Borrow U$.$S$.$ dollars, covert theve borrowed dolars into euros at the spot rate, and then invest these euros in euro$-$denominated German eovernment bonds.

Borrow US$,$ doltar, convert these borrowed dollars into curos at the spot rate, and then buy US$,$ bonds with these funds.

Borrow Euros, convert these borrowed euros into dollars at the spot rate. and then invest these dollars in a U$.$S$.$ based money market account.

Borrow Euros, convert these borrowed euros into dollars at the spot rate, and then imest these dollars in a diversifed portfolio of stocks of U$.$S$.$ based multinational firms.