A US Company Has a Euro Denominated Liability It Must Repay

question 36

True/False

A U.S. company has a euro denominated liability it must repay in 6 months. A short position in euro futures could help offset the corporation's foreign exchange risk.

---

Definitions:

Hindsight Bias

The tendency to believe, after an event has occurred, that one would have predicted or expected the outcome, often referred to as the "I-knew-it-all-along" effect.

Useful Product

An item or service that fulfills a need, serves a purpose, or provides value to its users.

Marketing Approach

Strategies and tactics used by companies to promote, sell, and distribute a product or service to consumers.

Critical Thinking

A systematic scrutiny and appraisal of a subject to develop an informed verdict.