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A Canadian company has a subsidiary in Mexico with significant assets and liabilities denominated in Mexican pesos. The company wants to hedge the net exposure

A Canadian company has a subsidiary in Mexico with significant assets and liabilities denominated in Mexican pesos. The company wants to hedge the net exposure arising from the peso-denominated assets and liabilities on its consolidated balance sheet. What type of hedging strategy should the company employ?
A. FX cash flow hedge
B. FX financing hedge
C. FX economic hedge
D. FX balance sheet hedge

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