The Argentina peso (P) spot rate, relative to $, is at P 2.75/$ and the six-month forward rate is P 2.90 /$. The actual rate settles six months later at P 2.85/$. If you entered into a (cash settled) six-month non-deliverable forward contract (cash-settled) today to buy P 3 million, what is your gain or loss 6 months later?

a. Gain of $18,148.82

b. Gain of $38,277.51

c. Loss of $18,148.82

d. Loss of $38,277.51

17. One way to reduce agency costs is that companies from weak investor protection countries:

a. should move to a better county.

b. cross listing their stocks to countries with strong investor protection.

c. should voluntarily comply with the provisions of the U.S. Sarbanes-Oxley Act.

d. should promise to be nice to their investors