Currency Risk Is a Concern for Any International Merger and Acquisition

question 11

True/False

Currency risk is a concern for any international merger and acquisition activity. For instance, once the bidder has successfully won the acquisition, the exposure evolves from a transaction exposure to a contingent exposure.

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Definitions:

Price Level

The overall level of prices for goods and services in an economy at a specific point in time.

Aggregate Supply Curve

Curve showing the level of real GDP produced at different price levels during a time period, ceteris paribus.

Maximum Output Level

The highest quantity of a good or service that can be produced efficiently with available resources and technology.

Profit Incentive

A profit incentive is a financial or material reward that motivates individuals or businesses to pursue certain actions or goals for economic gain.