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American Standard Co. has a 90 day 62,500 receivable. American Standards bank, Bank of America, suggests a put option contract that matures in 90 days.
American Standard Co. has a 90 day 62,500 receivable. American Standards bank, Bank of America, suggests a put option contract that matures in 90 days. American Standard purchases one put option contract, where one contract corresponds to a quantity of 62,500. American Standard is:
Hedging.
Speculating.
Locking in an arbitrage profit.
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