Which one of the following statements is correct?

		The use of forward rates increases the short-run exposure to exchange rate risk.
		Accounting translation gains and losses are recorded in the equity section of the balance sheet.
		There is no known method of reducing long-run exchange rate risk.
		A firm can record a profit on its income statement from a foreign subsidiary even when that subsidiary has no profit thanks to exchange rate risk.
		Unexpected changes in economic conditions are classified as short-run exposure to exchange rate risk.