Which of the Following Represents an Appropriate Hedge for an Australian

question 19

Multiple Choice

Which of the following represents an appropriate hedge for an Australian exporter expecting payment of US$100 000 in three months' time?

• A)Lend the Australian dollar equivalent for three months.
• B)Borrow the Australian dollar equivalent for three months.
• C)Lend US$100 000 for three months.
• D)Borrow the present value of US$100 000 for three months and buy Australian dollars spot.

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Definitions:

Master Gland

A term often used to describe the pituitary gland due to its central role in regulating other glands and many body functions.

Hypothalamus

A small region at the base of the brain crucial for hormone production and regulation of essential bodily functions such as temperature, hunger, and sleep.

Axon

A long, thin part of a neuron that transmits impulses to other neurons from bulb-shaped structures called axon terminals or terminal buttons.

Dendrite

Branch-like extensions of a neuron that receive signals from other nerve cells and are crucial for transmitting electrical messages to the neuron's cell body.