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One Argument for Exchange Rate Irrelevance Is That

Question 56

Multiple Choice

One argument for exchange rate irrelevance is that:


A) MNCs can hedge exchange rate exposure much more effectively than individual investors.
B) diversified stakeholders will not be affected by exchange rate movements because of offsetting effects.
C) purchasing power parity does not hold very well.
D) MNCs are typically not diversified across numerous countries.

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