Which of the following statement characterizes translation exposure?

Question

Quizplus · Accepted Answer

Translation exposure measures the accounting gains or losses from changes in exchange rates. It is not the same as economic exposure (A), which refers to the impact of currency fluctuations on a company's cash flows and future earnings. Translation exposure is affected by market volatility (C) and does address the impact of currency exchanges on balance sheets (D).

Which of the Following Statement Characterizes Translation Exposure