A city or country that provides large amounts of funds in ...

[ts19998]

A city or country that provides large amounts of funds in currencies other than its own is a(n) ________.
 
  A) offshore financial center
  B) ADR facilitator
  C) interbank market
  D) currency regulator

Question 2

How does a leads and lags strategy work? How does this type of strategy minimize foreign-exchange risk?
 
  What will be an ideal response?

[Tabitha_2016]

Answer to Question 1

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Answer to Question 2

Financial officers typically adjust the mix of currencies that make up the firm's working capital to minimize foreign-exchange risk. Often firms use a leads and lags strategy to try to increase their net holdings of currencies that are expected to rise in value and to decrease their net holdings of currencies that are expected to fall in value.