Financial Risk Manager Part 1
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Which of the following statements is most likely correct?
A
ABC would be better off by selling an option contract regardless of how large the change in the FX rate is and in which direction EUR moves relative to USD.
B
ABC would be better off by entering into a forward contract if EUR appreciates against USD by an amount significantly larger than USD 0.03 per EUR 1 and the call option premium is more than 0.03.
C
ABC would be better off by entering into a forward contract if EUR appreciates against USD by less than USD 0.03 per EUR 1.
D
ABC would be better off by entering into a forward contract if EUR depreciates against USD by an amount significantly larger than USD 0.03 per EUR 1 and the call option premium is less than 0.06.