The Most Direct and Popular Way of Hedging Transaction Exposure

question 24

Multiple Choice

The most direct and popular way of hedging transaction exposure is by

• A)exchange-traded futures options.
• B)currency forward contracts.
• C)foreign currency warrants.
• D)borrowing and lending in the domestic and foreign money markets.

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Definitions:

Purchasing Manager

A professional responsible for sourcing goods and services for a company, negotiating contracts, and managing supply chain relations.

Appropriate Suppliers

Vendors or providers that meet specific criteria for quality, reliability, and ethical standards, suitable for a business's needs.

Transportation Of Goods

The process of moving products from one location to another, often involving various modes of transport such as trucks, ships, or planes.

Inventory Carrying Costs

The total costs associated with holding and storing inventory, including warehousing, insurance, depreciation, and opportunity costs.