5. What following statements are correct? Planning for operating exposure is a finance responsibility From a broader perspective, operating exposure is not just the sensitivity of a firm's future cash flows to unexpected changes in foreign exchange rates, but also to its sensitivity to other key macroeconomic variables Operating exposure is inevitably subjective, because it depends on estimates of future cash flow changes over an arbitrary time horizon. Money market hedges almost always return more than forward hedges because of the greater risk involved. a) Ionly b) land Il c) Il and Ill e) Ill and IV 6. Which one of the following management techniques is likely to best offset the risk of long-run exposure to receivables denominated in a particular foreign currency? a) Borrow money in the foreign currency in question. b) Lend money in the foreign currency in question c) Increase sales to that country d) Increase sales in this county e) None of the above. it is difficult to change sales prices or to renegotiate factor costs 7. In the Therefore, realized cash flows will differ from those in the budget. a) short run b) long run c) medium run d) all of the above e) none of the above contract calls for the future delivery of a standard amount of foreign 8. A foreign currency exchange at a fixed time, place, and price. a) current b) forward c) option d) swap e) futures