Multiple Choice
A U.S. firm has a Canadian subsidiary that remits a large amount of its earnings to the parent on an annual basis. It also imports supplies from China, invoiced in Chinese yuan. The firm has no other foreign business and needs a small loan. The firm could best reduce its exposure to exchange rate risk by borrowing:
A) U.S. dollars.
B) Canadian dollars.
C) Chinese yuan.
D) a combination of Canadian dollars and Chinese yuan.
Correct Answer:
Verified
Correct Answer:
Verified
Q24: A currency swap between two firms of
Q25: If U.S. firms issue bonds in _,
Q26: If an MNC issues bonds denominated in
Q27: _ are commonly used to hedge interest
Q28: In a(n) _ swap, two parties agree
Q30: Some MNCs use a country's yield curve
Q31: If an MNC finances with a currency
Q32: Countries in emerging markets such as in
Q33: Floating rate bonds are often issued with
Q34: The _ for a given country represents