On February 23rd 20x8, Jennings Corp. entered into an agreement with Billings Co. to receive a series
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Question:
On February 23rd 20x8, Jennings Corp. entered into an agreement with Billings Co. to receive a series of interest payments in US dollars based on a fixed interest rate starting on February 23rd 20x9. Which of the following best describes the reason Jennings would enter into this agreement?
Question 14 options:
A. Jennings Co. is hedging against future increases in interest rates by locking in a rate today. | |
B. Jennings Co. believes the value of the US dollar will rise with respect to interest rates in the near future. | |
C. Jennings Co. believes the value of the US dollar will fall with respect to interest rates in the near future. | |
D. Jennings Co. believes that global interest rates will rise in comparison to those in the US economy. |
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