In netting cash flow across time,the scenario that assumes that the interest rate is zero:
A)is not a valid scenario for estimating currency risk.
B)is valid because interest rates generally do not affect cash flow.
C)underestimates the currency risk involved in the situation being analyzed.
D)is easy to use,but only makes sense where the interest rate does not affect the estimation of the currency risk.

Question

Quizplus · Accepted Answer

This scenario simplifies calculations by ignoring the time value of money, which can be practical in analyses where interest rates have minimal impact on currency risk estimations.

In Netting Cash Flow Across Time,the Scenario That Assumes That