In general, when a foreign subsidiary's assets are ____ than its liabilities, ____ will occur when the exchange rate on the currency of the country in which the foreign subsidiary operates loses value.

Question

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When a foreign subsidiary's assets are greater than its liabilities, the subsidiary has a positive net worth. Therefore, when the exchange rate on the currency of the country in which the subsidiary operates loses value, the value of the subsidiary's assets will decrease in the parent company's reporting currency. This will result in currency exchange losses for the parent company.

In General, When a Foreign Subsidiary's Assets Are ____ Than