Which of the following statement is CORRECT? A. Economic exposure only affects MNCs and it does not affect purely domestic firms. B. It is generally more difficult to hedge economic exposure than to hedge transaction exposure. C. Transaction exposure reflects the exposure of a MNCs consolidated financial statements to exchange rate fluctuations. D. Transaction exposure is not important as it doesn't impact the firm's cash flows. QUESTION 8 If you think that the Japanese yen is going to depreciate against the dollar, you should A. buy put options on the Japanese yen. B. buy call options on the Japanese yen. C. buy forward contracts on the Japanese yen. D. none of the above QUESTION 9 The sensitivity of the firm's value to unexpected changes in the exchange rate is A. transaction exposure. B. translation exposure. C. economic exposure. D. none of the above