B IS CORRECT. THE EXPORTER IS EXPOSED TO FX RISK AS THE FUNCTIONAL...

2. - CFA 2018 LEVEL 2 FRA QUESTION BANK MULTINATIONAL OPERATIONS QBANK
CFA 2018 LEVEL 2 FRA QUESTION BANK MULTINATIONAL OPERATIONS QBANK
2. B is correct. The exporter is exposed to FX risk as the functional currency may strengthen against the foreign currency. This will decrease the amount of functional currency that the exporter will receive. On the other hand, strengthening of the functional currency benefits an import purchase transaction.