When attempting to manage an account payable denominated in a foreign currency, the firm's only choice is to remain unhedged.

Name: When attempting to manage an account payable denominated in a foreign currency, the firm's only choice is to remain unhedged.
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Question

Quizplus · Accepted Answer

The firm has several options to hedge against foreign currency risk such as using forward contracts, options or currency swaps. Remaining unhedged is not the only choice available to manage account payable denominated in a foreign currency.

When Attempting to Manage an Account Payable Denominated in a Foreign