For MNCs,the Discrepancies in the Price of Currencies That Can

question 32

Multiple Choice

For MNCs,the discrepancies in the price of currencies that can occur on different markets:

• A)means that MNCs have to shop carefully when they need to buy foreign currency.
• B)allows MNCs to avoid losses arising out of currency transactions.
• C)relieves MNCs from having to plan currency transactions carefully.
• D)has allowed MNCs to become the largest speculators in currencies.

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Definitions:

Cash Inflow

Cash inflow is the movement of money into a business from various sources, including sales, investment income, and financing activities.

Cash Flows

The total amount of money being transferred into and out of a business, especially affecting liquidity.

Operating Activity

Activities directly related to the day-to-day operations of a business, including sales of products or services, and expenses.

Bonds Payable

Long-term liabilities representing money owed by a company to bondholders, to be repaid at a future date.