Question

Which of the following refers to the extent to which the reported consolidated results and balance sheets of a corporation are affected by fluctuations in foreign exchange valuesa. Transaction exposureb. Transition exposurec. Foreign exposure d. None of the above

Answer 1

The correct answer is letter "A": Transaction exposure.

Step-by-step explanation:

Transaction exposure is the risk level companies are attached to when involved in international trade. The more exposed a firm is in international trade, the more losses it might have. The risk is derived from how the currency exchange can fluctuate after the company became involved in an international transaction.