international financialmanagement 4国际财务管理

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1、1Chapter4MeasuringExposureToExchangeRateFluctuations2ObjectivesThischapterdistinguishesamongthreeformsbywhichMNCsareexposedtoexchangeraterisk:(1)transactionexposure,(2)economicexposure,and(3)translationexposure.Eachfirmdiffersindegreeofexposure.Afirmshouldb

2、eabletomeasureitsdegreeofeachtypeofexposureasdescribedinthischapter.Then,itcandecidehowtocoverthatexposureusingmethodsdescribedinthefollowingtwochapters.Thespecificobjectivesareto:3ObjectivesdiscusstherelevanceofanMNC’sexposuretoexchangeraterisk;explainhowt

3、ransactionexposurecanbemeasured;explainhoweconomicexposurecanbemeasured;explainhowtranslationexposurecanbemeasured.4IsExchangeRateRiskRelevant?PurchasingPowerParityArgumentExchangeratemovementswillbematchedbypricemovements.PPPdoesnotnecessarilyhold.5IsExcha

4、ngeRateRiskRelevant?TheInvestorHedgeArgumentMNCshareholderscanhedgeagainstexchangeratefluctuationsontheirown.Theinvestorsmaynothavecompleteinformationoncorporateexposure.Theymaynothavethecapabilitiestocorrectlyinsulatetheirindividualexposuretoo.6IsExchangeR

5、ateRiskRelevant?CurrencyDiversificationArgumentAnMNCthatiswelldiversifiedshouldnotbeaffectedbyexchangeratemovementsbecauseofoffsettingeffects.Thisisanaivepresumption.7IsExchangeRateRiskRelevant?StakeholderDiversificationArgumentWelldiversifiedstakeholderswi

6、llbesomewhatinsulatedagainstlossesexperiencedbyanMNCduetoexchangeraterisk.MNCsmaybeaffectedinthesamewaybecauseofexchangeraterisk.8IsExchangeRateRiskRelevant?ResponsefromMNCsManyMNCshaveattemptedtostabilizetheirearningswithhedgingstrategies,whichconfirmsthev

7、iewthatexchangerateriskisrelevant.9TypesofExposureAlthoughexchangeratescannotbeforecastedwithperfectaccuracy,firmscanatleastmeasuretheirexposuretoexchangeratefluctuations.Exposuretoexchangeratefluctuationscomesinthreeforms:TransactionexposureEconomicexposur

8、eTranslationexposure10TransactionExposureThedegreetowhichthevalueoffuturecashtransactionscanbeaffectedbyexchangeratefluctuationsisreferredtoastransactionexposure.Tomeasuretransactionexposure:projectthe