An Increase in the Value of a Foreign Currency Relative

question 17

Multiple Choice

An increase in the value of a foreign currency relative to the U.S. dollar ____ the conversion value of the foreign subsidiary's liabilities.

• A) decreases
• B) increases
• C) has no effect on
• D) is an average of

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Definitions:

Underwriting

involves the process of evaluating and assuming risk in financial transactions, notably in insurance and investments.

Insurance Company

A financial institution that provides coverage against specified risks in exchange for premiums, offering policies for health, life, property, and other forms of insurance.

Home Mortgage Loans

Loans provided by financial institutions to individuals for the purpose of purchasing residential properties, secured by the property itself.

Savings Banks

Financial institutions primarily engaged in accepting savings deposits and making loans and other investments.