A Manager Arguing Against Currency Hedging Would Most Likely Argue

question 72

Multiple Choice

A manager arguing against currency hedging would most likely argue that _____.

• A) currency hedging eats into company profits 
• B) currency hedging leaves firms at the mercy of the spot market 
• C) currency hedging decreases stability of cash flows and earnings 
• D) currency hedging is mainly a practice of very large MNEs

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Definitions:

Metamorphic Rocks

Rocks that have been transformed from an original state into a new texture or structure by heat, pressure, and/or fluid activity.

Solidification

The process of a liquid becoming solid, especially upon cooling, as in the formation of igneous rock from cooled magma or lava.

Erosion

The wearing away of soil, sediment, and rock through the removal of material by running water, waves, currents, ice, wind, and gravity.

Weathering

Physical disintegration and chemical decomposition of rocks, sediment, and soil due to exposure to water and other chemical, atmospheric, and biological agents.