Problem on hedge against foreign exchange risk


Question 1. You are a US company with a customer that is going to pay you 10,000 Euros in 6 months. The correct futures hedge for this situation is to enter into a contract in which you buy Euros (True or False)

Question 2. You are a US company that needs to pay a vendor 10,000 Euros 6 months from now. One option to hedge against foreign currency exchange risk might be to purchase Euros now (True or False).

Question 3. You are a US company that needs to pay a vendor 10,000 in Euros 6 months from now. One option to hedge against foreign exchange risk might be to enter into the sell Euros via a futures contract (true or false)

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Finance Basics: Problem on hedge against foreign exchange risk
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