Which of the Following Statements Holds True for a Forward

question 63

Multiple Choice

Which of the following statements holds true for a forward contract?

• A)It refers to the method of foreign-currency translation in which items in the subsidiaries' financial statements are translated into the currency of the parent corporation at the current exchange rate.
• B)It refers to the company-generated forecast of future spot exchange rates between two trading partners.
• C)It refers to a method of foreign-currency translation that uses exchange rates based on the rate in place when the assets and liabilities were originally acquired or incurred.
• D)It refers to the contract between two parties to buy or sell an asset today.
• E)It refers to an agreement in which a firm agrees to pay a specific rate at the beginning of the contract for delivery at a future date.

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Definitions:

Expected Return

The projected profit or loss from an investment over a given period.

Investment

The action of allocating resources, usually money, with the expectation of generating an income or profit.

Yields

The income return on an investment, such as the interest or dividends received from holding a particular security.

Record Producers

Professionals who oversee and manage the recording process of artists, playing critical roles in the development, recording, and production of music tracks.