1. If Company A (a U.S. firm) has a 7 million receivable and a 15 million payable both maturing in 1 year, determine the companys net exposure in the foreign exchange market.

Question 1 options:

	Company A has a net exposure of 8 million payable.
	Company A has no exposure because the exchange rate between euro and dollar is fixed.
	Company A has a net exposure of 22 million.
	Company A has a net exposure of 8 million receivable.

2. TRUE OR FALSE - a purely domestic firm that sources and sells only domestically does not face economic exposure at all because both the costs and earnings are in local currency. A. True B. False