The risk to a U.S. importer with foreign-currency-denominated accounts payable is that the dollar will depreciate.

Question

Quizplus · Accepted Answer

If the dollar depreciates, it means that it will be worth less in relation to the foreign currency. This can increase the cost of paying off accounts payable denominated in foreign currency, as the importer will need to exchange more dollars to obtain the same amount of foreign currency needed to pay off the debt. This can lead to financial losses for the importer.

The Risk to a U