An MNE Has a Contract for a Relatively Predictable Long-Term

question 2

Multiple Choice

An MNE has a contract for a relatively predictable long-term inflow of Japanese yen that the firm chooses to hedge by seeking out potential suppliers in Japan. This hedging strategy is referred to as:

• A) a natural hedge.
• B) currency-switching.
• C) matching.
• D) diversification.

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Definitions:

Federal Outlays

Expenditures by the U.S. federal government, including spending on defense, education, social security, and health care.

Federal Budget Process

The procedure by which the federal government creates and approves a budget, detailing the allocation of funds to different departments and programs.

Fiscal Year

A 12-month period used for accounting purposes and preparing financial statements that may not align with the calendar year.

Fiscal Year

A one-year period used by governments and businesses for accounting and budget purposes, which may not coincide with the calendar year.