If a Firm Has More Foreign Currency Assets Than Liabilities,and

question 19

Multiple Choice

If a firm has more foreign currency assets than liabilities,and no other foreign currency transactions,it has

• A)positive net exposure.
• B)negative net exposure.
• C)a fully balanced position.
• D)zero net exposure.

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Definitions:

Incremental Choices

Decisions made by comparing the additional benefits and costs of a little more or a little less of some activity.

Margin

In finance, the difference between the selling price and the cost of the goods sold, often expressed as a percentage of sales.

Economic Activity

The actions that involve the production, distribution, and consumption of goods and services in an economy.

Marginal Analysis

An examination of the benefits and costs of one additional unit of change.