[amp_mcq option1=”Transaction risk” option2=”Translation risk” option3=”Economic risk” option4=”All of the above” correct=”option4″]<\/p>\n
The correct answer is D. All of the above.<\/p>\n
Foreign exchange risk is the risk that a change in the exchange rate between two currencies will have an adverse effect on a company’s financial performance. Transaction risk is the risk that a change in the exchange rate between the currencies of two countries will affect the value of a specific transaction, such as the purchase or sale of goods or services. Translation risk is the risk that a change in the exchange rate between the currencies of two countries will affect the value of a company’s financial statements when they are translated into another currency. Economic risk is the risk that a change in the exchange rate between the currencies of two countries will affect a company’s economic performance, such as its sales, profits, and cash flow.<\/p>\n
Here is a more detailed explanation of each type of risk:<\/p>\n
[amp_mcq option1=”Transaction risk” option2=”Translation risk” option3=”Economic risk” option4=”All of the above” correct=”option4″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[700],"tags":[],"class_list":["post-33718","post","type-post","status-publish","format-standard","hentry","category-business-finance","no-featured-image-padding"],"yoast_head":"\n