Transaction exposure will affect firm involved in trading with customers or suppliers in other countries where transactions are measured in a currency other thatn the firm’s home currency. If a Hong Kong company exports goods to France, invoices the customer in francs and allow the customer 3 months’ credit, the company is exposed to transaction risk. Another situation in which transaction exposure occurs is when a US company takes out a foreign currency loan and therefore has to meet interest and capital payments in the foreign currency. The significance of transaction exposure to a firm will depend on the value of transactions or the size of the loan denominated in a foreign currency and the volatility of the relevant exchange rates. Transaction exposure will affect firm involved in trading with customers or suppliers in other countries where transactions are measured in a currency other thatn the firm’s home currency. If a Hong Kong company exports goods to France, invoices the customer in francs and allow the customer 3 months’ credit, the company is exposed to transaction risk. Another situation in which transaction exposure occurs is when a US company takes out a foreign currency loan and therefore has to meet interest and capital payments in the foreign currency. The significance of transaction exposure to a firm will depend on the value of transactions or the size of the loan denominated in a foreign currency and the volatility of the relevant exchange rates. Transaction exposure will affect firm involved in trading with customers or suppliers in other countries where transactions are measured in a currency other thatn the firm’s home currency. If a Hong Kong company exports goods to France, invoices the customer in francs and allow the customer 3 months’ credit, the company is exposed to transaction risk. Another situation in which transaction exposure occurs is when a US company takes out a foreign currency loan and therefore has to meet interest and capital payments in the foreign currency. The significance of transaction exposure to a firm will depend on the value of transactions or the size of the loan denominated in a foreign currency and the volatility of the relevant exchange rates. Transaction exposure will affect firm involved in trading with customers or suppliers in other countries where transactions are measured in a currency other thatn the firm’s home currency. If a Hong Kong company exports goods to France, invoices the customer in francs and allow the customer 3 months’ credit, the company is exposed to transaction risk. Another situation in which transaction exposure occurs is when a US company takes out a foreign currency loan and therefore has to meet interest and capital payments in the foreign currency. The significance of transaction exposure to a firm will depend on the value of transactions or the size of the loan denominated in a foreign currency and the volatility of the relevant exchange rates.