Operating Exposure Differs from Transaction Exposure Because

question 36

Multiple Choice

Operating exposure differs from transaction exposure because:

• A)transaction exposure focuses on short-term and contractual cash flow while operating exposure considers all cash flow.
• B)operating exposure considers only changes in exchange rates while transaction exposure considers the underlying profit in the transaction plus changes in the exchange rate.
• C)transaction exposure considers only changes in exchange rates while operating exposure considers the underlying profit in the transaction plus changes in the exchange rate.
• D)operating exposure focuses on short-term and contractual cash flow while transaction exposure considers all cash flow.

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Definitions:

Units

In business or manufacturing, units refer to the individual pieces or quantities produced or sold.

Net Operating Income

A measure of a company's profitability from its core business operations, excluding deductions for interest and taxes.

Planning Budget

A financial plan that estimates the revenue and expenses for a future period, typically created to guide a business in achieving its financial goals and objectives.

Wells Serviced

Wells Serviced refers to the number of oil, gas, or water wells that have undergone maintenance, repair, or installation services within a given timeframe.