An Exporter Who Is to Receive Payment in Foreign Currency

Multiple Choice

An exporter who is to receive payment in foreign currency in three months and who wants to engage in "hedging" would __________ the foreign currency on the three-Months forward market in order to protect himself/herself from __________ of the Foreign currency.

A) buy; an appreciation
B) buy; a depreciation
C) sell; an appreciation
D) sell; a depreciation