________ Is a Technique Used by MNEs to Deal with Currency

question 6

Multiple Choice

________ is a technique used by MNEs to deal with currency exposure.

• A) No counter-measure
• B) Speculation
• C) Hedging
• D) All are techniques MNEs could use.

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Definitions:

Required Rates of Return

The minimum annual percentage earned by an investment that will entice individuals or companies to put money into it, considering the risk.

Formulation

The process of devising or planning a strategy, policy, or system often based on specified principles or procedures.

Coefficient of Variation

A measure of relative variability that indicates the ratio of the standard deviation to the mean, commonly used to assess the risk per unit of return.

Expected Return

The weighted average of all possible returns from an investment, factoring in the probabilities of each outcome.