The net effect of an increase in the exchange rate on translation exposure depends on:
A) the translation method used.
B) whether the value of assets exceeds the value of liabilities.
C) whether the value of liabilities exceeds the value of assets.
D) All of these.

Question

Quizplus · Accepted Answer

The net effect of an increase in the exchange rate on translation exposure depends on all the given factors, including the translation method used and the relative values of assets and liabilities. Therefore, option D is the correct answer.

The Net Effect of an Increase in the Exchange Rate