Transaction exposure can be mitigated by taking forward, Ask an Expert

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Transaction exposure can be mitigated by taking forward market positions (hedging). If you are a US importer of German textiles and have just ordered a one year supply at a cost of 20 million euros, Payment is due in one year. How can you protect (fix) the cash outflow in dollars should the forward rate be incorrect? Assume the forward rate on the euro is $1.15/Euro

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91789588

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