The Mexican Subsidiary of an American Durables Giant Acquired a Market

Multiple Choice

The Mexican subsidiary of an American durables giant acquired a market research firm a few months ago.The rate of exchange at the time of acquisition was 12 pesos= 1 dollar.At the end of the financial year the subsidiaries' financial statements need to be translated into the currency of the parent corporation.The current exchange rate is 10 pesos= 1 dollar.The subsidiaries' financial statement is translated into the currency of the parent corporation at the exchange rate of 12 pesos= 1 dollar.The above serves as an example of the _____ of foreign-currency translation.

A) hedging process
B) current-rate method
C) Monte Carlo method
D) temporal method
E) Markov process