exchange today in order to have $240$ million in one year. $($Round your response to the nearest dollar.$)$

b$.$ If Halliburton enters a forward contract, agreeing to buy $240$ million in one year at an exchange rate of $94=$$$1,$ it

will need $$2,342,378$ today if it plans to invest the dollars at the U$.$S$.$ interest rate of $9\%.($Round your response to the

nearest dollar.$)$

c$.$ If Halliburton invests today at the U$.$S$.$ interest rate of $9\%,$ without entering into any other type of contract, does the

firm know how many dollars it needs today to fulfill its equipment contract in one year?

A$.$ No$,$ but it takes the risk.

B$.$ No$,$ it depends on the exchange rate at the end of the contract.

C$.$ Yes, it would need $$2,342,378.$

D$.$ Both A and $B$ are correct.

d$.$ Which method$($s$)$ described in $($a$)$ through $($c$)$ provide$($s$)$ a hedge against exchange$-$rate risk? Which do$($es$)$ not?

Which method is Halliburton likely to prefer?

A$.$ Hedges are provided by $($a$)$ and $($c$)$ but not $($b$),$ and Halliburton prefers $($c$)$ because it costs less.

B$.$ A hedge is provided by $($a$)$ but not $($b$)$ and $($c$),$ and thus Halliburton only prefers $($a$).$

C$.$ Hedges are provided by $($a$)$ and $($b$)$ but not $($c$),$ and Halliburton prefers $($b$)$ because it costs less.

D$.$ Hedges are provided by $($a$)$ and $($b$)$ but not $($c$),$ and Halliburton prefers $($a$)$ because it costs less.

e$.$ In order for the results in $($a$)$ and $($b$)$ to be equivalent, the forward contract exchange rate in $($b$)$ has to be $$ per

dollar. $($Round your response to two decimal places.$)$