Lets say you are a foreign student studying in US and you have to pay $15000 tuition next August. You are worried that your home currency may depreciate compare to dollar. What can you do to avoid that risk?

PROFESSOR'S GUIDANCE THIS WEEK'S LE:

This is an example of an exposure to a foreign currency and ways one can eliminated the risk of that exposure in advance. Remember risk in finance in the uncertainty with respect to the outcome. In this case you don't know what the exchange rate is going to be next august.