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Business, 05.05.2020 17:36 denarreiahspen5921

FabCorporation will need 500,000 Canadian dollars (CND) in 90 days to cover a payable position. Currently, a call option with an exercise price of CND USD .75 and a premium of .01 is available. Also, a 90-day put option with an exercise price of CND USD .73 and a premium of .01 is available. FAB will purchase an option to hedge its payable position. Assuming that the spot rate in 90 days is CND USD .76, what is the total amount paid, assuming FAB wishes to minimize its cost? Your answer should be the total US dollar expense to satisfy the payable. $370,000 $385,000 $360,000 $380,000

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FabCorporation will need 500,000 Canadian dollars (CND) in 90 days to cover a payable position. Curr...
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