D none of the options a q25 exposure to currency risk

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D) none of the options A Q25) Exposure to currency risk can be measured by the sensitivities of A) the future home currency values of the firm's assets and liabilities, as well as the firm's operating cash flows to random changes in exchange rates. B) the future home currency values of the firm's assets and liabilities. C) the firm's operating cash flows to random changes in exchange rates. D) none of the options D Q26) Economic exposure refers to A) the sensitivity of realized domestic currency values of the firm's contractual cash flows denominated in foreign currencies to unexpected exchange rate changes. B) ex post and ex ante currency exposures. C) the potential that the firm's consolidated financial statement can be affected by changes in exchange rates. D) the extent to which the value of the firm would be affected by unanticipated changes in exchange rate. A Q27) Before you can use the hedging strategies such as a forward market hedge, options market hedge, and so on, you should consider running a regression of the form P = a + b × S + e . When reviewing the output, you should initially focus on A) the slope coefficient b. B) the intercept a. C) R 2 . D) mean square error, MSE. A Q28) The link between the home currency value of a firm's assets and liabilities and exchange rate fluctuations is A) asset exposure. B) asset exposure and operating exposure. C) operating exposure. D) none of the options B Q29) In recent years, the U.S. dollar has depreciated substantially against most major currencies of the world, especially against the euro. A) The stronger euro has made many American products less expensive in euro terms, boosting sales of U.S. products in Europe. B) The stronger euro has made many European products more expensive in dollar terms, hurting sales of these products in the United States. Additionally, the stronger euro has made many American products less expensive in euro terms, boosting sales of U.S. products in Europe. C) The stronger euro has made many European products more expensive in dollar terms, hurting sales of these products in the United States. D) none of the options
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A Q30) From the perspective of the U.S. firm that owns an asset in Britain, the exposure that can be measured by the coefficient b in regressing the dollar value P of the British asset on the dollar/pound exchange rate S using regression equation P = a + b × S + e is A) asset exposure. B) accounting exposure. C) operating exposure. D) none of the options B Q31) On the basis of regression equation P = a + b × S + e , we can decompose the variability of the dollar value of the asset, VAR( P ), into two separate components: VAR( P ) = b 2 × VAR( S ) + VAR( e ). The first term in the right-hand side of the equation, b 2 × VAR( S ) represents A) the part of the variability of the dollar value of the asset that is related to random changes in the exchange rate, as well as the residual part of the dollar value variability that is independent of exchange rate movements.
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