Question

In: Accounting

Changes in the spot rates can: a. affect a firm's present value of future cash flows,...

Changes in the spot rates can:

a. affect a firm's present value of future cash flows, posing economic risk.

b. impose translation risk on a firm.

c. impose accounting risk on a firm.

d. affect the value of a company's future cash transactions, posing transaction risk.

Solutions

Expert Solution

Solution: affect the value of a company's future cash transactions, posing transaction risk.

Explanation: Transaction exposure occurs when the future cash flows of the company are affected by changes in the spot rates

ekkarill92 answered 2 years ago
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