To practice operational hedging is to shift production and procurement abroad to match revenues in foreign currency when exchange rate fluctuations are very difficult to predict.

Question

Quizplus · Accepted Answer

Operational hedging involves adjusting operational strategies, such as shifting production or procurement to different countries, to mitigate the risks associated with unpredictable exchange rate fluctuations. This can help a company match its costs with its revenues in the same currency, reducing the impact of currency volatility.

To Practice Operational Hedging Is to Shift Production and Procurement