Since Forward Contracts Are Easy to Use for Hedging, Any

question 45

True/False

Since forward contracts are easy to use for hedging, any exposure to exchange rate movements should be hedged.

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Definitions:

Tight Culture

A culture that has strict social norms and a low tolerance for deviant behaviors.

Losing Face

A social phenomenon where an individual's status, dignity, or respect is diminished in the eyes of others, often due to a failure or wrongdoing.

Collectivist Culture

Cultures that emphasize the needs and goals of the group as a whole over the needs and wishes of each individual.

Holier-Than-Thou Effect

A cognitive bias where individuals overestimate their moral qualities or behaviors in comparison to others.