When the dollar strengthens, the reported consolidated earnings of U.S.-based MNCs are ____ affected by translation exposure. When the dollar weakens, the reported consolidated earnings are ____.

Question

​When the dollar strengthens, the reported consolidated earnings of U.S.-based MNCs are ____ affected by translation exposure. When the dollar weakens, the reported consolidated earnings are ____.

Quizplus · Accepted Answer

When the dollar strengthens, the value of foreign earnings decreases when converted back to dollars, negatively affecting the reported consolidated earnings of U.S.-based MNCs (unfavorably affected). Conversely, when the dollar weakens, the value of foreign earnings increases when converted back to dollars, positively affecting the reported consolidated earnings (favorably affected).

​When the Dollar Strengthens, the Reported Consolidated Earnings of U

When the Dollar Strengthens, the Reported Consolidated Earnings of U