Which of the Following Firms Is Not Exposed to Translation

question 12

Multiple Choice

Which of the following firms is not exposed to translation exposure?

• A) Firm X, with a fully owned subsidiary that periodically remits earnings generated in Great Britain to the U.S.-based parent.
• B) Firm Y, with a fully owned subsidiary that periodically generates foreign losses in Sweden. The parent covers at least some of these losses.
• C) Firm Z, with a fully owned subsidiary that generates substantial earnings in Germany. The subsidiary never remits earnings but reinvests them in Germany.
• D) All of the above firms are exposed to translation exposure.

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Definitions:

Key Account Management

The practice of using team selling to focus on important customers so as to build mutually beneficial, long-term, cooperative relationships.

Technical Personnel

denotes individuals who possess specialized skills, knowledge, and expertise in technological areas.

Sales Commission

A form of compensation awarded to sales employees based on the sales they generate.

Independent Salespeople

Individuals who sell a company's products or services without being employed by the company, often working on a commission basis.