When a company is engaged in an international transaction and agrees to use a foreign currency to conduct the transaction:
a) it will use an S.D.R.
b) it is exposed to a certain amount of risk.
c) it will use the services of the Ex-Im Bank.
d) All of the above
e) None of the above
Answer: it is exposed to a certain amount of risk
A company is exposed to a certain amount of risk, due to possible fluctuations in the currency exchange rates, in an international transaction when it agrees to use a foreign currency.
