Which of the Following Actions Could a Company Use to Hedge

question 34

Multiple Choice

Which of the following actions could a company use to hedge balance sheet exposure?

• A) Forward contract on foreign currency
• B) Foreign currency option
• C) Foreign currency borrowing
• D) All of the above may be used to hedge balance sheet exposure.

---

Definitions:

Microsystems

The immediate environments (such as family, school, and peer group) in which individuals interact directly and which influence their development.

Mesosystems

In ecological systems theory, the interaction between two or more settings that the developing person actively participates in, such as the connection between family experiences and school life.

Exosystems

A layer in Bronfenbrenner's ecological systems theory referring to settings that indirectly influence an individual, such as parents' workplaces.

Macrosystems

The broadest context in ecological systems theory, encompassing societal norms, values, and laws that influence an individual's development.