The subsidiary operates only domestically

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Reference no: EM131186320

A U.S.-based multinational corporation has 100% owned subsidiary in Argentina. The subsidiary operates only domestically, that is, all transactions occur within Argentina. Therefore, the U.S. multinational corporation

a. is exposed to translation risk only.

b. is not exposed to exchange rate risk because the subsidiary operates 100% domestically.

c. is exposed to both translation exposure and economic exposure.

d. is most concerned with transactions exposure.

Reference no: EM131186320

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