If a Firm Is Due to Be Paid in Euros

question 105

Multiple Choice

If a firm is due to be paid in euros in two months,to hedge against exchange rate risk the firm should

• A) sell foreign exchange futures short.
• B) buy foreign exchange futures long.
• C) stay out of the exchange futures market.
• D) do none of the above.

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Definitions:

Insecure Attachments

A type of attachment style characterized by anxiety and uncertainty in relationships, often resulting from inconsistent caregiving in early childhood.

Self-reliance

The reliance on one's own powers and resources rather than those of others.

Temperament

The inherent part of an individual's personality, including mood, disposition, and adaptability.

Attachment Security

The degree of trust in the availability and responsiveness of one's attachment figures, often developed in early childhood.