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ABC inc. has 107M account receivables that the company will get in one year. ABC wants to hedge it using the money market hedge. Today's
ABC inc. has 107M account receivables that the company will get in one year. ABC wants to hedge it using the money market hedge. Today's spot rate is 1.5$/, the company has $100M debt at 8%, can borrow s at 7%, can invest $s at 6%. If instead of 107M ABC could have $X account receivables, find X that would make ABC indifferent
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