Which of the Following Is the Most Likely Strategy for a U.S

question 147

Multiple Choice

Which of the following is the most likely strategy for a U.S. firm that will be receiving Swiss francs in the future and desires to avoid exchange rate risk (assume the firm has no offsetting position in francs) ?

• A) purchase a call option on francs.
• B) sell a futures contract on francs.
• C) obtain a forward contract to purchase francs forward.
• D) all of the above are appropriate strategies for the scenario described.

---

Definitions:

Xenophobia

A fear or hatred of foreigners or strangers.

Pluralism

A concept in sociology and political science that acknowledges a diverse society where multiple groups maintain their independent cultural traditions.

High-context

A communication style where most of the information is either in the physical context or internalized in the person, with very little in the coded, explicit part of the message.

Ethnocentrism

The belief in the inherent superiority of one's own ethnic group or culture.