ABC has sold items for US$100, 000 which will be received in 60 days. In hedge...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
ABC has sold items for US$100, 000 which will be received in 60 days. In hedge all of this risk, the company can Enter into an interest rate swap for a notional amount of US$100, 000. Enter into an option to buy $US100, 000 at a fixed price Enter into a forward contract to buy US$100, 000 in 60 days Enter into a forward contract to sell US $100, 000 in 60 days ABC has sold items for US$100, 000 which will be received in 60 days. In hedge all of this risk, the company can Enter into an interest rate swap for a notional amount of US$100, 000. Enter into an option to buy $US100, 000 at a fixed price Enter into a forward contract to buy US$100, 000 in 60 days Enter into a forward contract to sell US $100, 000 in 60 days
Expert Answer:
Answer rating: 100% (QA)
Option D is correct the company can enter into a forward contract to sell US 100000 in 60 days This ... View the full answer
Related Book For
Posted Date:
Students also viewed these accounting questions
-
A bank enters into an interest rate swap with a nonfinancial counterparty using bilateral clearing where it is paying a fixed rate of 3% and receiving LIBOR. No collateral is posted and no other...
-
A financial institution has entered into an interest rate swap with company X. Under the terms of the swap, it receives 10% per annum and pays six-month LIBOR on a principal of $10 million for five...
-
A financial institution has entered into an interest rate swap with company X. Under the terms of the swap, it receives 4% per annum and pays six-month LIBOR on a principal of $10 million for five...
-
Julio sold his corporation to a competitor, Exeter LLC, for $100,000,000. Julio incorporated his business 17 years ago by investing $500,000 plus his proprietary know-how. There have been no other...
-
Refer to Exercise 11.1. a. Plot the equation Å· = .51 + 1.38x in the scatterplot produced in Exercise 11.1. Comment on how close this line is to the line you fitted through the points....
-
Bernoulli's equation for fluid flow in an open channel with a small bump is Q 2gb Q +ho = +h+H 2gbh ho Q- h H where Q = 1.2 m/s = volume rate of flow g = 9.81 m/s = gravitational acceleration b = 1.8...
-
The weights of individual M&M plain candies were obtained by placing each candy in a paper cup, then obtaining the weight without accounting for the weight of the cup. Identify at least one likely...
-
Universal Leasing leases electronic equipment to a variety of businesses. The companys primary service is providing alternate financing by acquiring equipment and leasing it to customers under...
-
a vector H = cos (wt + k*r) in the direction of (6x+4y+ 3z). Given an arbitrary point in k (say (4,5,6)) and r is a point in the cartesian coordinate system, is the wave phyiscally real or not and...
-
Gulf Uniform Supply, Inc. (GUS), a merchandising business, is organized as a corporation. The business sells a complete line of uniforms for a variety of businesses and organizations, including...
-
ENERAL (1) (All F7 & 7 Question 21 Not yet answered Marked out of 2.00. P Flag question irst Semester 2021 F9 ww.google.com O 120, 90, 109.5 O 180, 120, 109.5 O 107.3, 90, 90 O 120, 180, 90...
-
What is contract-based modeling?
-
Which of the following are new introductions in UML 2? (a) Guards (b) Combined fragments (c) Interaction Occurrences (d) Frames
-
Waterfall model is not suitable for (a) Small projects (b) Accommodating change (c) Complex projects (d) None of these
-
Use the data in Table 9.2 to assign the Q branch lines in Figure 9.6. Account for the relative intensities. Figure 9.6 Table 9.2 Spectroscopic constants for diatomics in the ground electronic state...
-
Actor Bank has an association with use case Withdraw with multiplicity 0..*. This means that Bank is involved with multiple Withdraw operations (a) sequentially (b) parallely (c) either (d) neither
-
Many companies are going beyond government regulation and are developing strategies and practices that create a world economy that the planet can support indefinitely. This represents O A....
-
The slopes of the tangents at the points where the curve y = x2 - 4x intersects the X-axis is 1) 1 2) +2 3) +3 4) +4
-
Estimate delta, gamma, and theta from the tree in Example 18.1. Explain how each can be interpreted.
-
Investors Profit/Loss in Problem 11.20b when short maturity call is worth more than long maturity call
-
The volatility of a certain market variable is 30% per annum. Calculate a 99% confidence interval for the size of the percentage daily change in the variable.
-
In Appendix 16A.1, we illustrate the calculation of a standard error for the marginal effect in a probit model of transportation, Example 16.4. In the appendix, the calculation is for the marginal...
-
In Example 16.3, we illustrate the calculation of the likelihood function for the probit model in a small example. a. Calculate the probability that \(y=1\) if \(x=1.5\), given the values of the...
-
In Examples 16.2 and 16.4, we presented the linear probability and probit model estimates using an example of transportation choice. The logit model for the same example is \(P(A U T...
Study smarter with the SolutionInn App