Which of the Following Reflects a Hedge of Net Receivables

question 35

Multiple Choice

Which of the following reflects a hedge of net receivables in British pounds by a U.S. firm?

• A) purchase a currency put option in British pounds.
• B) sell pounds forward.
• C) borrow U.S. dollars, convert them to pounds, and invest them in a British pound deposit.
• D) A and B

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Definitions:

Conformity

Refers to the act of matching attitudes, beliefs, and behaviors to what is perceived as normative social standards or expectations.

Informational Power

The influence one may have over others stemming from the possession or control of knowledge and information.

Reliable Source

An entity or individual that consistently provides accurate and trustworthy information, often used in the context of gathering evidence or news.

Deliberately Withholds

Refers to the intentional act of not providing information or resources that could be beneficial or necessary for others.