A Large Firm May Finance in a Foreign Currency to Offset

question 40

True/False

A large firm may finance in a foreign currency to offset a net payable position in that foreign country.

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Definitions:

Retained Earnings

Profits that a company has earned to date, less any dividends or other distributions paid to shareholders.

Dividends

Payments made by a corporation to its shareholder members. It is the portion of corporate profits paid out to stockholders.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenue, indicating the company's bottom line.

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity, typically including the balance sheet, income statement, and cash flow statement.