The possibility that changes in the value of a nation's currency will result in variations in the market value of a business's assets is referred to as
A) hedge risk.
B) foreign exchange risk.
C) conversion risk.
D) transaction risk.

Question

Quizplus · Accepted Answer

Foreign exchange risk refers to the possibility of fluctuations in the value of a nation's currency causing variations in the market value of a business's assets. This risk can occur due to various factors such as changes in economic policies, political factors, or global events. It is also known as currency risk or exchange rate risk. The other options are not suitable as they do not refer specifically to the impact of currency fluctuations on asset values.

The Possibility That Changes in the Value of a Nation's