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(please answer within 1hr, and provide detailed answers. Thankyou) i. Suppose that you have a foreign currency receivable (payable). What option strategy places a floor
(please answer within 1hr, and provide detailed answers. Thankyou)
i. Suppose that you have a foreign currency receivable (payable). What option strategy places a floor ceiling) on your domestic currency revenue (cost)? ii. Suppose that XYZ International Company has purchased a Swiss francs futures contract (contact size is SFr 125,000) at a price of $0.8250 at 50.83. If the spot rate for the Swiss franc at the date of settlement is SFr = $0.8250, what is the Company's gain or loss on the contract? What are you buying if you purchase a U.S. dollar European put option against the Mexican peso with a strike price of MXN10.0/5 and a maturity of July? (Assume that it is May and the spot rate is MXN10.5/$.) iv. If a European subsidiary of a U.S. firm has net exposed liabilities of euro 500,000, and the euro increases in value from $1.50/euro to $1.55/euro then what is the translation exposure of U.S. firm? 111Step by Step Solution
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