A US Company Sells Merchandise to a Foreign Company Denominated in in the Foreign

question 16

Multiple Choice

A U.S. company sells merchandise to a foreign company denominated in the foreign currency. Which of the following statements is true?

• A) If the foreign currency appreciates, a foreign exchange gain will result.
• B) If the foreign currency depreciates, a foreign exchange gain will result.
• C) No foreign exchange gain or loss will result.
• D) If the foreign currency appreciates, a foreign exchange loss will result.
• E) Any gain or loss will be included in comprehensive income.

---

Definitions:

Reservation Policy

A set of rules and guidelines established by a service provider regarding the booking of its services or facilities, often including deposit requirements, cancellation policies, and booking deadlines.

Empowerment

The process of giving individuals or groups the power and resources to make decisions, take actions, and be responsible for their outcomes.

Standardization

The process of implementing and developing technical standards to ensure products and services meet certain quality and safety criteria consistently.

Customer Complaints

Feedback from customers expressing dissatisfaction with a product or service, often seen as an opportunity for improvement by businesses.