Question
A dealer buys EUR 5,000,000 forward for delivery in, two months at EUR0.5556/USD and simultaneously sells EUR 5,000,000 forward for delivery in three months at
A dealer buys EUR 5,000,000 forward for delivery in, two months at EUR0.5556/USD and simultaneously sells EUR 5,000,000 forward for delivery in three months at EUR0.5545/USD. This foreign exchange transaction is equivalent to:
a.
selling two-months Euro forward at USD1.7999/EUR and buying three-months Euro forward at USD1.8034/EUR.
b.
buying two-months Euro forward at USD1.7999/EUR and selling three-months Euro forward at USD1.8034/EUR.
c.
buying three-months Euro forward at USD1.7999/EUR and selling two-months Euro forward at USD0.5545/EUR.
d.
selling three-months Euro forward at USD0.5556 /EUR and buying two-months Euro forward at USD1.8034/EUR.
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All About Options
Authors: Thomas McCafferty
3rd Edition
0071484795, 978-0071484794
