Which of the following is the most effective strategy to manage the risk of foreign exchange losses due to sales to foreign customers?
A) Hire a risk consultant.
B) Implement a hedging strategy.
C) Maintain a large foreign currency balance.
D) Insist that customers only pay in a stable currency.

Question

Quizplus · Accepted Answer

Implementing a hedging strategy is the most effective way to manage foreign exchange risk, as it allows a company to lock in exchange rates and protect against unfavorable currency fluctuations.

Which of the Following Is the Most Effective Strategy to Manage