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If You Fear the Dollar Will Rise Against the Spanish

Question 9

Multiple Choice

If you fear the dollar will rise against the Spanish peseta,with a resulting adverse change in the dollar value of the equity of your Spanish subsidiary,you can hedge by


A) selling pesetas forward in the amount of net assets
B) buying pesetas forward in the amount of net assets
C) reducing the liabilities of the subsidiary
D) selling pesetas forward in the amount of total assets

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