SUPPOSE THAT YOUR FIRM IS U.S.-BASED IMPORTER OF GERMAN AUTOMOBIL...

104. - BT THANH TOAN QUOC TE MULTINATIONAL FINANCIAL MANAGEMENT DAP AN 104. - BT THANH TOAN QUOC TE MULTINATIONAL FINANCIAL MANAGEMENT DAP AN
BT THANH TOAN QUOC TE MULTINATIONAL FINANCIAL MANAGEMENT DAP AN
104. Suppose that your firm is U.S.-based importer of German automobile accessories. You pay for them in euros and sell them in dollars. You have just ordered next year's inventory. In one year your firm owes a payment of €100,000 to your German supplier. Today's spot exchange rate is €1.00 = $1.50; One-year call and put options are available on the euro with a variety of strike prices. How can you place an upper limit on the dollar cost of this order? a. Buy one-year put options on the euro. b. Sell one-year put options on the euro. c. Sell one-year call options on the euro. d. Buy one-year call options on the euro.