Al-Huda Corporation is an Omani firm offering different services. However, its main activity focuses on importing goods from England. Often, the firm pays its bills in GBP keeping part of its liabilities denominated in this currency. Suppose the spot rate 1 GBP = 0.6255 OMR and the 3 month forward rate is GBP1.5990/OMR. What type of exchange exposure is Al-Huda Corporation is facing? O a. Transaction exposure O b. Economic exposure O . Translation exposure O d. Operating exposure
Al-Huda Corporation is an Omani firm offering different services. However, its main activity focuses on importing goods from England. Often, the firm pays its bills in GBP keeping part of its liabilities denominated in this currency. Suppose the spot rate 1 GBP = 0.6255 OMR and the 3 month forward rate is GBP1.5990/OMR. What type of exchange exposure is Al-Huda Corporation is facing? O a. Transaction exposure O b. Economic exposure O . Translation exposure O d. Operating exposure
Chapter18: Long-term Debt Financing
Section: Chapter Questions
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