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LOS f, (Part 1): Discuss the three types of exposure to exchange rate risk.
Q1. The risk associated with a fall in demand for a firm’s product caused by an appreciation of the home currency of the firm is called:
A) economic exposure.
B) translation exposure.
C) transaction exposure.
Q2. Derivatives are most often used to hedge which type of exchange-rate risk?
A) Transaction exposure.
B) Translation exposure.
C) Economic exposure.
Q3. The exchange-rate risk associated with falling asset values in foreign subsidiaries caused by currency fluctuations is called:
A) economic exposure.
B) translation exposure.
C) transaction exposure. | 
发表于 2009-4-9 10:59
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