Question: Read through section 11-2d, Exhibit 11-3, Comparison of Techniques to Hedge Payables, on page 360 of Chapter 11 in the textbook. Answer the two questions:

Read through section 11-2d, Exhibit 11-3, Comparison of Techniques to Hedge

Read through section 11-2d, Exhibit 11-3, Comparison of Techniques to Hedge Payables, on page 360 of Chapter 11 in the textbook.

Answer the two questions:

  1. What is your new value for the money market hedge? Would this affect your initial decision from reading through section 11-2d? Discuss the drawbacks from using a different hedging technique.
  2. Consider the limitations of using the loan proceed either for debt payment or firm's investment in the money market hedge.

Your submission must be one to two pages, completed as a Microsoft Word document including calculations (in your Word doc or an Excel spreadsheet).

Payables, on page 360 of Chapter 11 in the textbook. Answer the

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