Question: Properly implemented, hedging a transaction exposure with a forward contract will allow the hedging firm to A) Eliminate all exchange rate volatility from the transaction

Properly implemented, hedging a transaction exposure with a forward contract will allow the hedging firm to

A) Eliminate all exchange rate volatility from the transaction

B) Eliminate any downside risk, but still allow the firm to benefit from favorable movements in the exchange rate

C)Allow the firm to profit if it correctly guesses the direction that the exchange rate will move

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