Which of the Following Is Not True Regarding Currency Correlations

question 73

Multiple Choice

Which of the following is not true regarding currency correlations?

• A) Two highly positively correlated currencies act almost as if they are the same currency.
• B) If two inflow currencies are highly positively correlated transaction exposure is somewhat offset.
• C) If two inflow currencies are negatively correlated transaction exposure is somewhat offset.
• D) If two currencies, one an inflow currency and the other an outflow currency, are highly positively correlated, transaction exposure is somewhat offset.

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Definitions:

Closing Entries

Journal entries made at the end of an accounting period to transfer temporary account balances to permanent accounts in preparation for the next accounting period.

T Accounts

T accounts are a visual representation of individual accounts used in accounting to depict debits and credits for transaction entries.

Adjusting Entries

Ledger postings concluded during the final phase of an accounting cycle to assign income and costs to their respective periods of occurrence.

Closing Entries

Journal entries made at the end of an accounting period to transfer balances from temporary accounts to permanent accounts.