_____ risk refers to the ways in which long-term exchange rate movements affect firms.

Question

Quizplus · Accepted Answer

Economic risk is the risk that arises from the effect of exchange rate fluctuations on a company's future cash flows, revenues, and expenses. It relates to the impact of unpredictable market movements on a company's operating income. In contrast, transactions and translation risks are short-term risks that arise from the accounts payable and accounts receivable of a company, respectively. Consolidated and accounting risks are not related to exchange rate movements.

_____ Risk Refers to the Ways in Which Long-Term Exchange