Forward Exchange Contracts Are Used for Hedging but Not for Speculating

question 40

True/False

Forward exchange contracts are used for hedging but not for speculating.

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Definitions:

Units-of-production

A depreciation technique that distributes an asset's expense over its lifespan according to the quantity of units manufactured.

Accumulated Depreciation

The total amount of depreciation expense that has been recorded against a fixed asset since it was put into use.

Residual Value

The estimated value that an asset will have at the end of its useful life.

Double-declining-balance

A method of accelerated depreciation calculating a larger depreciation charge in the first year of an asset's life and progressively smaller charges in subsequent years.