To Reduce Economic Exposure When a Foreign Currency Has a Greater

question 18

True/False

To reduce economic exposure when a foreign currency has a greater impact on cash inflows than on cash outflows, an MNC could reduce its level of foreign sales, increase its foreign supply orders, or restructure debt to increase debt payments in the foreign currency.

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Definitions:

Rule 10b-5

A regulation enacted under the Securities Exchange Act of 1934 that prohibits fraud, misrepresentation, and insider trading in the securities market.

Nonpublic

Information or entities not accessible or known to the general public or specific non-designated individuals.

Confidential Information

Sensitive or proprietary data that is shared under the agreement of secrecy and is protected from unauthorized disclosure.

Insider Trading

The unethical and often illegal practice of trading on the stock exchange to one's own advantage through having access to confidential information.