Explain what is meant by forward contracts and futures using examples. List the main advantages / disadvantages for their use.

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Q: D4) Grossnickle Corporation issued 20-year, noncallable, 8.5% annual coupon bonds at their par value…

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Q: The Price Company will produce 55,000 widgets next year. Variable costs will equal 40 percent of…

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Q: Two mutually exclusive alternatives have the estimates shown below. Use annual worth analysis to…

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Q: Daryl lent money to Melissa to buy her school supplies. Melissa borrowed promised to pay after 2…

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Q: What is the present value of a $1,000 60-month annuity due, if r is 6% APR compounded monthly?

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Q: Summerdahl Resort's common stock is currently trading at $26 a share. The stock is expected to pay a…

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Exchange Rate Risk

It is the possibility that the value of a currency will fluctuate in the future. In the wake of globalization, business establishments have increasingly ventured into international markets. The volume of international trade has prospered excellently in the near past and is expected to be more affluent in the future. The use of exchange-traded derivative financial instruments has been multi-folded to provide for the requirements of various MNCs and offshore potential investors. Most banks and financial institutions have helped integrate the global economies. Our Government has introduced some bold and extreme measures to fulfil the purpose behind the fiscal, industrial, and monetary policies. The enactment of GST is a huge step towards streamlining the taxation system of the country. Owing to Covid-19, this aspect of corporate risk management has become critical.