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Question
A French firm is buying $1,000,000 of optical cable from a firm in the United States. The French firm will pay for the cable in thirty days. To protect itself from changes in the exchange rate between the Euro and dollar, the French firm enters into a futures contract to purchase $1,000,000 at a price of $1.25/. How many Euros will it cost the French firm to purchase $1,000,000 using the futures contract?
a. 125,000,000
b. 2,500,000
c. 1,250,000
d. 1,000,000
e. 800,000
Answer
This answer is hidden. It contains 53 characters.
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