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Please help, urgent. Question 1 Anheuser-Busch is one of America's best-loved Brewery and Beers company in United States has secure a contract to supply beer
Please help, urgent.
Question 1 Anheuser-Busch is one of America's best-loved Brewery and Beers company in United States has secure a contract to supply beer to Beertique New Zealand amounting to USD10,000,000 due in three months. The following information is available: NZD1.4248/USD 4.80 p.a. 2.30 p.a. NZD1.5101/USD Sport rate New Zealand Interest rate US Interest Rate Three-month Forward rate Three-month Call Option: Exercise Price Premium Three-month Put Option: Exercise Price Premium NZD1.4010/USD 1% NZD1.4450/USD 1% Calculate with details working and explanation how Beertique New Zealand might hedge its foreign exchange transaction exposure using the following strategies: a) Forward hedge b) Money Market hedge c) Option hedge What is your recommendation? (30 marks)Step by Step Solution
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