Question: The operating cash cycle of a multinational firm goes from
The operating cash cycle of a multinational firm goes from cash collection from customers, cash holding for anticipated transaction needs (the transaction motive for holding cash), possible cash repositioning into another currency, and eventual cash disbursements to pay operating expenses. Assuming the initial cash collection is in one currency, and the eventual cash disbursement is in another currency, what can a multinational firm do to shorten its cash cycle, and what risks are involved?
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