Multiple Choice
A firm wants to use an option to hedge 12.5 million in receivables from New Zealand firms. The premium is $.03. The exercise price is $.55. If the option is exercised, what is the total amount of dollars received (after accounting for the premium paid) ?
A) $6,875,000.
B) $7,250,000.
C) $7,000,000.
D) $6,500,000.
E) none of the above
Correct Answer:
Verified
Correct Answer:
Verified
Q23: If your firm expects the euro to
Q24: You purchase a put option on Swiss
Q25: Which of the following is true?<br>A) Most
Q26: The one-year forward rate of the British
Q27: When the current exchange rate is less
Q29: Since futures contracts are traded on an
Q30: The currency futures markets are regulated by
Q31: Research has found that the options market
Q32: The shorter the time to the expiration
Q33: If you expect the British pound to