subject
Business, 10.05.2021 15:10 fraven1819

You will receive 554000 Ukraine hryvnia (UAH) in 6 months. You want to insure the amount by an option with a strike price of €0.029. The current exchange rate (UAHEUR) equals to €0.026. The premium per contract equals €7 with the contract size being 100,000 UAH. The respective effective interest rate equals 0.99%. 1. Do you buy a put or a call option to hedge the receivables?
2. Calculate the total value of all your transactions in euro if the spot rate at maturity equals €0.018, assuming that you bought the option.
3. Calculate the total value of all your transactions in euro if the spot rate at maturity equals €0.04, assuming you bought the option.
4. Is it better to hedge your position? Select the correct
a) You should hedge your position because it reduces risk.
b) You should not hedge your position because it is costly.
c) There is not enough information to make a decision.

ansver
Answers: 3

Another question on Business

question
Business, 22.06.2019 00:30
A) plot the m1 and m2 money stock in the us from 1990-2015. (hint: you may use the data tools provided by fred.) (b) plot the nominal interest rate from 1960 to 2014. (hint: you can either use the daily interest rates for selected u.s. treasury, private money market and capital market instruments from or the effective federal funds rate fromfred.) (c) the consumer price index (cpi) is a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services. intuitively, the cpi represents the cost of living or the average price level. plot the cpi from 1960 to 2013.(d) the inflation rate is the yearly percentage change in the average price level. in practice, we usually use the percentage change in the cpi to compute the inflation rate. plot the inflation rate from 1960 to 2013.(e) explain the difference between the ex-ante and ex-post real interest rate. use the fisher equation to compute the ex-post real interest rate. plot the nominal interest rate and the ex-post real interest rate from 1960 to 2013 in the same graph.
Answers: 3
question
Business, 22.06.2019 23:50
Juniper company, inc. uses a perpetual inventory system. the company purchased $9,750 of merchandise on august 7 with terms 1/10, n/30. on august 11, it returned $1,500 worth of merchandise. on august 16, it paid the full amount due. the correct journal entry to record the payment on august 16 is:
Answers: 1
question
Business, 23.06.2019 09:50
Frick (1991) claimed that computers would become so powerful that k-12 educators and students would be able to produce their own multimedia and web-based learning materials. he predicted that teachers and students would soon be able to use computer-video technology to produce their own learning materials. all it would require is time, know-how, and some funds.
Answers: 3
question
Business, 24.06.2019 00:30
Amanufacturing company has a beginning finished goods inventory of $15,300, raw material purchases of $18,700, cost of goods manufactured of $33,900, and an ending finished goods inventory of $18,500. the cost of goods sold for this company is:
Answers: 2
You know the right answer?
You will receive 554000 Ukraine hryvnia (UAH) in 6 months. You want to insure the amount by an optio...
Questions
question
Mathematics, 22.01.2020 16:31
Questions on the website: 13722367