An Exporter Can Share Exchange Rate Risk with Their Customers

question 31

Multiple Choice

An exporter can share exchange rate risk with their customers by

• A)invoicing in their customer's local currency.
• B)splitting the difference, and invoicing half of sales in local currency and half of sales in home currency.
• C)invoicing sales in a currency basket such as the SDR as the invoice currency.
• D)both b and c

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Definitions:

Kilograms

A unit of mass in the metric system, equal to one thousand grams and used worldwide as a standard for quantifying mass in many contexts.

Weigh

The action of determining the mass or weight of an object using scales or other measuring instruments.

Compound Journal Entry

A journal entry that affects more than two accounts.

Fiscal Year

A one-year period chosen by a business for financial reporting and taxation purposes, which may not coincide with the calendar year.