MNCs generally do not need to hedge because shareholders can hedge their own risk.

Question

Quizplus · Accepted Answer

MNCs may still need to hedge their exposure to currency fluctuations, as fluctuations in exchange rates can significantly impact their revenues and profitability. While shareholders can individually hedge their own exposure to currency risk, it is typically more efficient for the MNC to do so centrally through a corporate hedging program.

MNCs Generally Do Not Need to Hedge Because Shareholders Can