A ________ Is Written Between a Firm and a Bank

question 4

Multiple Choice

A ________ is written between a firm and a bank and it fixes the currency exchange rate for a transaction that will occur at a future date.

• A) currency forward contract
• B) currency options contract
• C) currency call option
• D) currency put option

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Definitions:

Mitigating Damages

The legal principle requiring a party who has suffered harm to take reasonable actions to minimize the impact of the damage.

Undue Risk

Excessive or unnecessary danger or threat, often considered in contexts where the level of risk is not justified by the potential benefits or outcomes.

Avoidable Losses

Losses that could have been prevented through reasonable care or alternative actions.

Waiver

The voluntary relinquishment or surrender of a known right or privilege.