Changes in foreign exchange rates can affect a firm in all of the following ways except:
A) The prices a firm pays to acquire raw materials from suppliers abroad.
B) The amount of cash a firm receives when it collects an account receivable, a loan
Receivable, or another receivable denominated in a currency other than its own.
C) The value of domestic liabilities with fixed interest rates.
D) The prices a firm charges for products sold to customers abroad.

Question

Quizplus · Accepted Answer

The value of domestic liabilities with fixed interest rates is not affected by foreign exchange rates as they are predetermined and do not vary with exchange rate fluctuations. However, changes in foreign exchange rates can affect the prices paid to acquire raw materials, the amount of cash received from accounts receivable, and the prices charged for products sold to customers abroad.

Changes in Foreign Exchange Rates Can Affect a Firm in All