Question
Suppose you need to payV = 50,000 GBPin a year from now. Spot rate of GBP is 1.3. You do not have enough USD to
Suppose you need to payV = 50,000 GBPin a year from now. Spot rate of GBP is 1.3. You do not have enough USD to purchase50,000 GBPright now. Assume the futurespremium = 0.03
What is the benefit of hedging with futures contract if the GBP spot rate in a year from now is 1.2?
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Practical financial management
Authors: William r. Lasher
5th Edition
0324422636, 978-0324422634
