1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Lady bird [3.3K]
3 years ago
8

A company headquartered in Vancouver, British Columbia, is building a pipeline in Russia. The invoice amount is due in 90 days a

nd is denominated at 28 million rubles. The Canadian dollar is trading for 28 rubles currently and 29 rubles 90 days forward.
Which of the following strategies will the Canadian firm most likely pursue in the 90-day forward market to hedge the transaction exposure inherent in this situation?

A. Purchase 28,000,000 rubles.
B. Purchase 29,000,000 rubles.
C. Sell 28,000,000 rubles.
D. Sell 29,000,000 rubles.
Business
1 answer:
Alinara [238K]3 years ago
5 0

Answer:

C. Sell 28,000,000 rubles

Explanation:

By doing so, the company will <u>immediately receive</u> the amount equivalent in Canadian Dollars by selling 28 million rubles in forward and after 90 days when the invoice amount (28 million rubbles) is received from building the pipeline, will be used to netting of the forward contract.

In this way, company can hedge the currency exposure, and reduce the risk which can be generated from currency volatility.

You might be interested in
ABC had the following net income (loss) the first three years of operation: $7,100, ($1,600), and $3,600. If the Retained Earnin
Alex73 [517]

Answer:

The total amount of dividends paid over these three years: $8000

Explanation:

  • Net income (loss) in three years

$7,100, ($1,600), and $3,600  

=> the total net income is the first three years of operation is:

$7,100 -  ($1,600) +  $3,600  

= $9,100

This money is not kept in the Retained Earnings because it is used for dividend payment. But Earnings balance at the end of year three is $1,100, so the total amount of dividends paid over these three years:

= Total net incomes - Retained Earnings

= $9,100 - $1,100,  

= $8000

Hope it will find you well.

3 0
3 years ago
Read 2 more answers
Mediocre economists often consider only the immediate apparent effects of a change, whereas a good economist will also consider
olga nikolaevna [1]

Answer:

C. The importance of secondary effects

Explanation:

Secondary economic impact is a study of economic activities due to recurring rounds of spending by companies, households, and the government.

Secondary effects are long term and comes after the primary effect (first round of spending).

It is also called induced economic effect.

6 0
3 years ago
Kara wants to build a business. She has plenty of capital and potential investors and partners. She wants to avoid the burden of
Akimi4 [234]

Answer:

The correct answer is B.

Explanation:

The fact that Kara has plenty of capital means she most likely would not need financial intervention from any other party.

It is not logical for her to bring in a partner who will share profits when she has invested all the capital. Because she will enjoy all the proceeds from the business alone, she will also bear all liabilities.  

Cheers!

4 0
3 years ago
Read 2 more answers
If a perfectly competitive firm finds that price is less than average variable cost, it should: shut down immediately. increase
Musya8 [376]

Answer: It should shot down immediately.

Explanation:

If the market price is equal to average cost at the profit-maximizing level of output, then the firm is making zero profits. If the market price that a perfectly competitive firm faces is below average variable cost at the profit-maximizing quantity of output, then the firm should shut down operations immediately.

4 0
3 years ago
What is the type of occupation of densist​
ivann1987 [24]

Answer:

Dentist is an occupation related to dental/tooth disease.

Explanation:

It is an occupation related to dentistry which is in the field of health.

7 0
2 years ago
Other questions:
  • On January 2, 2020, Howdy Doody Corporation purchased 12% of Ranger Corporation's common stock for $50,000. Ranger's net income
    15·1 answer
  • In a small, closed economy, national income (GDP) is $350.00 million for the current quarter. Individuals have spent $100.00 mil
    5·1 answer
  • Kesterson Corporation has provided the following information: Cost per Unit Cost per Period Direct materials $ 6.30 Direct labor
    11·1 answer
  • When demand is inelastic and price is decreased:
    15·1 answer
  • Cajemp Inc. is a real estate developer that has been in the market for several years. Most real estate developers are now constr
    8·1 answer
  • . Which one of the following applies to a general partnership?A. The firm's operations must be controlled by a single partner.B.
    12·1 answer
  • AYEEEE YALL WANNA JOIN ME IN A KAHOOT AT 12:20 - 1:00?
    5·2 answers
  • Prepare a marketing plan to market yourself. Visit a career website and locate three careers listed on the website and determine
    7·1 answer
  • The unadjusted trial balance of PS Music as of July 31, 2016, along with the adjustment data for the two months ended July 31, 2
    11·1 answer
  • Can someone help me with this question?
    12·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!