Corporation X has a number of exporting transactions with companies based in Vietnam.Exporting activities result in receivables.If the settlement currency is the US dollar,which of the following will happen by changes in the direct or indirect exchange rates?
A)Option A
B)Option B
C)Option C
D)Option D

Question

Quizplus · Accepted Answer

If the settlement currency is the US dollar, changes in the exchange rate between the US dollar and the Vietnamese dong will affect the value of the receivables in terms of the Vietnamese currency. If the US dollar strengthens, the Vietnamese companies will need more dong to settle the same amount of US dollar receivables, and if the US dollar weakens, they will need less dong.

Corporation X Has a Number of Exporting Transactions with Companies