The FI Is Acting as a Hedger When It

question 74

Multiple Choice

The FI is acting as a hedger when it

• A)buys or sells currency to balance the FI's net exposure.
• B)takes a nonzero net position in a particular currency.
• C)processes an exporter's transaction in a foreign currency.
• D)makes a market in a currency.
• E)advises customers on their international business.

---

Definitions:

Inherent Motivation

Internal drive to perform actions for their own sake, due to personal satisfaction or interest.

Extrinsic Motivation

Motivation driven by external rewards such as money, grades, or praise.

Seniority-Based Pay

A compensation system where an employee's wage or salary is determined by their length of service in the company.

Guaranteed Wages

A compensation strategy where employees are assured of a minimum amount of income, regardless of work hours or output.