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Chapter 9 - Chapter 9 Managing Transaction Exposure and...

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Chapter 9 Managing Transaction Exposure and Economic Exposure 1. Transaction exposure occurs if there is a change in an exchange rate and . * A. an outstanding obligation denominated in a foreign currency is settled B. sales are made in cash C. purchases are made in cash D. an outstanding obligation denominated in a home currency is settled E. all of the above 2. If a foreign currency depreciates, exchange losses will occur when exposed . * 3. Economic exposure measures the impact of actual exchange conversion involving the following cases except . * 4. A forward market hedge involves the following except . * 5. A money-market hedge does not involve the following . A. spot rate B. interest rate * C. forward rate D. marketable securities E. accounts receivable
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6. An option-market hedge in foreign exchange risk management is a form of a(n) . * 7. A currency swap involves the following . *
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