Respuesta :
If 90-day forward rate to exchange euro for dollars is a correct estimate of the spot rate 90 days from now, then the real cost of hedging payables will be zero.
What is meant by transaction costs?
In the context of market exchanges, transaction costs are costs incurred. If there is no transaction cost, it is considered that there will be no obstacles to negotiations. An allocation cannot be a contractual equilibrium because an inefficient allocation leads to unrealized contractual opportunities. All costs are related to completing a transaction, including planning, making decisions, changing plans, resolving conflicts, and providing customer service. Transaction costs are therefore one of the most important factors in business operations and management. In theory, transaction costs can be divided into four categories:
Negotiation costs, opportunity costs, search costs, police/enforcement costs.
To learn more about transaction costs, visit:
https://brainly.com/question/13164233
#SPJ1
