What has occurred when one company arranges to buy a foreign currency sometime in the future, at an exchange rate quoted today? O a The company has entered a forward contract. None of the above O c. The currency has been devalued. O d. The company has purchased a foreign currency option. O b. Quiz 1 Fi stion 3 at red out of estion e What is the intrinsic value of a foreign currency option? a. The chance that a currency will rise over time to make the option in the money O b. The gain that could be realized if the option was exercised immediately Oc. The difference between the spot rate and the strike price O d. The difference between a call option and a put option Next page Jestion 4 "yot vered ed out of question Time left 1:25:59 Under U.S. GAAP, which of the following conditions must be met to qualify for hedge accounting? a. There must be formal documentation of the hedging relationship. The hedge must be effective. O c. All of the above must be met in order to qualify for hedge accounting. Od. A derivative must be used specifically to hedge fair value exposure or cash flow exposure. O b. Quiz navigat 1 3 Finish atterns 1 ved of on The number of Japanese yen () required today to buy one U.S. dollar ($) today is called: Oa the spot rate. O b. the retail rate. C. the exact rate. d. the forward rate.
