In a forward hedge, if the forward rate is an accurate predictor of th – McqOptions

MCQOPTIONS

1.	In a forward hedge, if the forward rate is an accurate predictor of the future spot rate, the real cost of hedging payables will be:
A.	highly positive.
B.	zero.
C.	highly negative.
D.	none of the above
Answer» D. none of the above

Discussion

No Comment Found

Related MCQs

If a firm based in the Netherlands wishes to avoid the risk of exchange rate movements, and is due to receive USD100,000 in 90 days, it could:
Insurance purchased to cover the risk of expropriation __________, and will typically cover __________.
An increase in the current account deficit will place _______ pressure on the home currency value, other things equal.
______________ is (are) income received by investors on foreign investments in financial assets (securities).
Which of the following is not true regarding host government attitudes towards foreign direct investment (FDI)?
What are the three additional days known as that a drawer gives to the drawee for payment
If portable disk players made in China are imported into the United States, the Chinese manufacturer is paid with
Which one of the following areas is NOT a way companies often respond to exchange rate risk when they alter their product strategy?
With _______, the exporter ships the goods to the importer while still retaining actual title to the merchandise.
A bill of exchange requesting the bank to pay the face amount upon presentation of documents is a: