T() 1. The objective of foreign exchange rate protection is to anticipate and influence the effect of unexpected changes in foreign exchange rates on a firm's future cash flows. (1)F 2. One goal of foreign exchange rate protection is to minimize foreign exchange rate management costs. (1) 3. A forward contract is an example of a balance sheet hedge. T@ 4. Varying the sourcing currency is an example of an operational hedge. (1) 5. If the expected Loss from not hedging is less than the cost of forward cover, the firm should hedge. TF 6. A company with a large number of small transactions could not hedge. TF 7. If a currency swap is illegal in the country of a subsidiary, the company should not execute a swap. (1) F 8. A swap is an altemative form of hedging. (D 9. A forward contract is a form of hedge. TF 10. A currency swap is a transaction in which two parties exchange one currency for another currency with the understanding that after a certain period each party returns to the other the amount of currency originally exchanged. T() 1. The objective of foreign exchange rate protection is to anticipate and influence the effect of unexpected changes in foreign exchange rates on a firm's future cash flows. (1)F 2. One goal of foreign exchange rate protection is to minimize foreign exchange rate management costs. (1) 3. A forward contract is an example of a balance sheet hedge. T@ 4. Varying the sourcing currency is an example of an operational hedge. (1) 5. If the expected Loss from not hedging is less than the cost of forward cover, the firm should hedge. TF 6. A company with a large number of small transactions could not hedge. TF 7. If a currency swap is illegal in the country of a subsidiary, the company should not execute a swap. (1) F 8. A swap is an altemative form of hedging. (D 9. A forward contract is a form of hedge. TF 10. A currency swap is a transaction in which two parties exchange one currency for another currency with the understanding that after a certain period each party returns to the other the amount of currency originally exchanged