Jacko Co. is a U. S.-based MNC with net cash inflows of euros and net cash inflows of Sunland francs. These two currencies are highly negatively correlated in their movements against the dollar. Kriner Co. is a U. S.-based MNC that has the same exposure as Jacko Co. in these currencies, except that its Sunland francs represent cash outflows. Which firm has a high exposure to exchange rate risk?

Kriner Co.

Explanation:

An exchange rate is when the value of the currency of a country is compared with the currency of another country.

From the question, we are informed that Jacko Co. is a U.S.-based MNC with net cash inflows of euros and net cash inflows of Sunland francs and that these two currencies are highly negatively correlated in their movements against the dollar.

We are further told that Kriner Co. is a U.S.-based MNC that has the same exposure as Jacko Co. in these currencies, except that its Sunland francs represent cash outflows.

Based on the information, the firm that has a high exposure to exchange rate risk is Kriner Co.

answer; blank(1); /rises; blank(2); //increases;

answer(b) revenue account which increases;