Which One of the Following Statements Is Correct

question 75

Multiple Choice

Which one of the following statements is correct?

• A)A firm's long-run exchange rate risk can be reduced by borrowing money in the foreign country where it has operations.
• B)FASB requires that all translation gains and losses be recorded annually on the firm's income statement.
• C)Unexpected changes in economic conditions are classified as short-run exposure to exchange rate risk.
• D)Foreign assets are recorded on the parent firm's balance sheet based on the exchange rate at the time each asset is acquired.
• E)The usage of forward rates primarily addresses the long-run exposure to exchange rate risk.

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Definitions:

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