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Assume that Hamp Inc. has net payable in Mexican pesos in 180 days and would...

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Question

Finance

Assume that Hamp Inc. has net payable in Mexican pesos in 180 days and would like to manage the transaction exposure by using money market instruments. How much money would you need today for the hedging. Consider the following information
Net payable (Mexican pesos) 229,000
Maxican interest rate (for 180 days) 8.00%
U.S. interest rate (for 180 days) 4.00%
Spot exchange rate ($/peso) 0.15

Question 94 options:

$28,806

$31,806

$30,667

$31,855

Answer & Explanation Solved by verified expert
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