Multiple Choice
Which of the following describes what a company should do to create a range forward contract in order to hedge foreign currency that will be received?
A) Buy a put and sell a call on the currency with the strike price of the put higher than that of the call
B) Buy a put and sell a call on the currency with the strike price of the put lower than that of the call
C) Buy a call and sell a put on the currency with the strike price of the put higher than that of the call
D) Buy a call and sell a put on the currency with the strike price of the put lower than that of the call
Correct Answer:
Verified
Correct Answer:
Verified
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