If Salerno Inc

question 20

Multiple Choice

If Salerno Inc. desires to lock in a minimum rate at which it could sell its net receivables in Japanese yen but wants to be able to capitalize if the yen appreciates substantially against the dollar by the time payment arrives, the most appropriate hedge would be:​

• A) ​a money market hedge.
• B) ​a forward sale of yen.
• C) ​purchasing yen call options.
• D) ​purchasing yen put options.
• E) ​selling yen put options.

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Definitions:

Gestational Diabetes

A form of diabetes that occurs during pregnancy, typically resolving after childbirth but increasing the risk of certain health issues.

Variable Costs

Costs that change in proportion to the level of goods or services a company produces, such as materials and labor.

Fixed Costs

Fixed costs are business expenses that remain constant regardless of the level of production or sales.

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Individuals or entities that create or supply goods and services for consumption by consumers, contributing to the economy.