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Which of the Following Is NOT True of Currency Hedging

Question 102

Multiple Choice

Which of the following is NOT true of currency hedging?


A) It is the practice of insuring against potential losses that result from adverse changes in exchange rates.
B) Companies use it to lessen the risk associated with international transfers of funds.
C) Companies use it to protect themselves in credit transactions where there is a time lag between billing and receipt of payment.
D) It is the instantaneous purchase and sale of a currency in different markets for profit.

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