If a foreign exchange transaction calls for payment in the exporter's currency, the importer has the foreign exchange risk.

Question

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If the exporter's currency is used for payment, it means that the importer will have to purchase the exporter's currency, leaving them exposed to foreign exchange risk. Any changes in the exchange rate between the time of the agreement and the time of payment will affect the final cost to the importer.

If a Foreign Exchange Transaction Calls for Payment in the Exporter's