What are the gains from hedging foreign exchange risk?
What will be an ideal response?
Answer: An entrepreneur would find it desirable to hedge foreign exchange risk because the profits from the entrepreneurial venture are a significant part of the entrepreneur's wealth. Unlike regular investors, entrepreneurs are unable to diversify away such risks through transactions in their own portfolios. Hence, if forward rates are unbiased predictors of future spot rates, risk-averse entrepreneurs will choose to hedge their future foreign currency cash flows because doing so will reduce the variance of the flows without changing their expected values in the domestic currency. Therefore, reducing the variance of future profits would increase the entrepreneur's expected utility.
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Financing activities include receiving cash dividends from investments in equity securities.
Answer the following statement true (T) or false (F)
A FORALL statement can process a group of rows in a DML operation.
Answer the following statement true (T) or false (F)
What is the key difference between an agreement and a contract?
A) A contract is always enforceable in the court of law, while an acceptance may or may not be. B) A contract can only be between two individuals, while an acceptance can have two or more people involved. C) A contract requires mutual assent from all parties, while an acceptance needs only to be accepted by a majority of people involved. D) A contract need not be legally binding, while an agreement must be legally binding.
What does the act of state doctrine assert?
What will be an ideal response?