which one of the following is the risk that a firm faces when it opens a...
which one of the following is the risk that a firm faces when it opens a facility in a foreign country, given that the exchange rate between the firms home country and this foreign country fluctuates over time?
a. international risk
b. exchange rate risk.
c. political risk.
d. purchasing power risk
e. diversifiable risk
Homework Answers
Since there will be transaction between company located in home country and company located at foreign company, there exists an exchange rate risk on account of inter company transactions.
so answer is Exchange rate risk.
Option b)
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