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  3. 1) an unexpected change in exchange rates impacts

1) An unexpected change in exchange rates impacts a firm's expected cash flows at three levels,...

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Finance

1) An unexpected change in exchange rates impacts a firm'sexpected cash flows at three levels, depending on the time horizonused (Short Run, Medium Run, and Long Run). Describe the threeoperating exposure's phases of adjustment assuming that parityconditions do not hold among foreign exchange rates, nationalinflation rates, and national interest rates (disequilibrium).

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Dear student The answer of your question is mentioned below The unexpected change in exchange rate impacts on firms expected cash flows in three ways and firstly we have to understand the meaning of those parameters 1 Foreign exchange rate It is also known as Forex market It means we have to trade our home countrys currency with any other    See Answer
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