A British Firm and a U

question 38

Multiple Choice

A British firm and a U.S. Corporation each wish to enter into a currency swap hedging agreement. The British firm is receiving U.S. dollars from sales in the U.S. but wants pounds. The U.S. firm is receiving pounds from sales in Britain but wants dollars. Which of the following choices would best satisfy the desires of the firms?

• A) The British firm pays dollars to a swap dealer and receives pounds from the dealer. The U.S. firm pays pounds to the swap dealer and receives dollars.
• B) The U.S. firm pays dollars to a swap dealer and receives pounds from the dealer. The British firm pays pounds to the swap dealer and receives dollars.
• C) The British firm pays pounds to a swap dealer and receives pounds from the dealer. The U.S. firm pays dollars to the swap dealer and receives dollars.
• D) The British firm pays dollars to a swap dealer and receives dollars from the dealer. The U.S. firm pays pounds to the swap dealer and receives pounds.

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Definitions:

Ecclesia

A state church or an organized religion that is closely integrated with the political and social structure of a society, often holding significant influence.

State Supported Churches

Churches that receive financial and political backing from the government.

Collective Conscience

The set of shared beliefs, ideas, attitudes, and knowledge that is common to a social group or society.

Sentiments

Complex feelings or emotions that reflect attitudes or beliefs towards certain subjects or situations.