Exporters and importers are not exposed to any exchange risks.

Question

21 Sep 2022

Answer :

Word Count : 265

1. Transaction risk:

When companies are involved either in trade transaction (export and import), financial transaction (borrowing and lending in foreign currency) dividend payment/receipts, they are exposed to transaction risk. Such companies face Transaction risk, which could be defined as the risk that exists because of possible changes in currency rates between transaction date ________ ____ __________ ___ _________ _____ _______ ______.
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