Writing Homework Help
DeVry University Foreign Currency Options & Hedging Contracts Discussion
1. Why might a company prefer a foreign currency option rather than a forward contract in hedging a foreign currency firm commitment? Why might a company prefer a forward contract over an option in hedging a foreign currency asset or liability? How could this create a problem for a U.S. company where you may be employed?
2.What is a derivative? How are derivatives used to hedge foreign exchange risk?