Question

Q.3 (a) what is translation exposure? Is management of translation exposure more important that economic exposure? Discuss.

Answer 1

It is also known as "accounting exposure.” Translation risk can lead to what appears to be a financial gain or loss that is not a result of a change in assets, but in the current value of the assets based on exchange rate fluctuations. Therefore, companies seek to hedge this risk as best as possible.

Answer 2

Answer:

Heya Mate:

The term translation exposure management, refers to the different methods companies use to handle translation exposure, also known as accounting exposure,