Translation Losses Are ____, While Gains on Forward Contracts Used

question 48

Multiple Choice

Translation losses are ____, while gains on forward contracts used to hedge translation exposure are ____.

• A) tax deductible; not taxed
• B) not tax deductible; not taxed
• C) not tax deductible; taxed
• D) tax deductible; taxed

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Definitions:

Minimize

To reduce something to the least possible amount or degree.

Dissonance

A state of conflict or inconsistency between a person's beliefs, attitudes, or actions, often leading to discomfort and change.

Cognitive Dissonance

A psychological phenomenon in which an individual experiences discomfort or distress from holding two or more contradictory beliefs, ideas, or values at the same time.

Opinions

Personal views, beliefs, or judgments that may not be based on fact or knowledge.