A United States company expects to have to pay 1 million Canadian dollars in six months. Explain
Question:
(a) A forward contract;
(b) An option.
Exchange Rate
The value of one currency for the purpose of conversion to another. Exchange Rate means on any day, for purposes of determining the Dollar Equivalent of any currency other than Dollars, the rate at which such currency may be exchanged into Dollars...
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a The company could enter into a long forward contract ...View the full answer
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