When Referring to Foreign-Currency Transactions, Hedging Is a Process in Which

question 93

Multiple Choice

When referring to foreign-currency transactions, hedging is a process in which:

• A)a company protects itself from losing money in one transaction by engaging in a counterbalancing transaction.
• B)companies wager that the currency of one country will rise relative to their own.
• C)companies sell the same product in various countries at similar prices to minimize the currency risks associated with any one particular country.
• D)a company wagers that the currency of one country will fall relative to its own.

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