Question
A U.S. firm has a MXN 50,000,000 payable (money they will owe to a supplier, for example) due in 7 months.The current exchange rate is
A U.S. firm has a MXN 50,000,000 payable (money they will owe to a supplier, for example) due in 7 months.The current exchange rate is MXN11.25/$ and the U.S. firm fears the MXN could appreciate substantially over the next 7 months.The interest rate on 7-month MXN money market deposits is 4.15% (a periodic rate, not a yearly rate).How could the U.S. firm execute a money market hedge
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Multinational Business Finance
Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett
15th edition
134796551, 134796550, 978-0134796550
