An effective for an MNC to assess its economic exposure is to look at the firm's:

Question

Quizplus · Accepted Answer

The income statement reflects the MNC's revenue, expenses, and net profit or loss in a specified period. By analyzing the income statement, the MNC can identify the portions of its revenue and expenses that are generated from foreign operations and the impact of exchange rate fluctuations on its net profit or loss. This helps the MNC to assess its economic exposure to currency risk. Liquidity, retained earnings, and shareholder's equity may provide insight into the MNC's financial health, but they do not directly assess its economic exposure.

An Effective for an MNC to Assess Its Economic Exposure