If a Company Has a EUR 100 000 Account Payable

Multiple Choice

If a company has a EUR 100 000 account payable in three months and it expects the AUD to appreciate by the time of payment,a reasonable strategy would be to:

A) lag the payment cash flow.
B) borrow the present value of EUR 100 000 and do a money market hedge in the Australian market.
C) enter into a forward exchange contract to sell euros in three months' time.
D) lead the payment cash flow.