Which of the Following Is Probably Not Appropriate for an MNC

question 31

Multiple Choice

Which of the following is probably not appropriate for an MNC wishing to reduce its exposure to British pound payables?

• A) Purchase pounds forward.
• B) Buy a pound futures contract.
• C) Buy a pound put option.
• D) Buy a pound call option.

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Definitions:

Manufacturing Overhead

Indirect factory-related costs incurred in the production process, such as depreciation of equipment and utility costs.

Factory Labor

It refers to the workforce engaged in manufacturing processes, often within a factory setting, and encompasses all labor costs directly associated with the creation of a company's products.

Manufacturing Overhead

Indirect costs related to manufacturing that are not directly tied to specific product units, such as factory rent or maintenance.

Work in Process Inventory

Inventory that includes goods that are in the production process and not yet completed.