prevent loss or transfer the risk. WR risk assessment is based upon reaching the
beneficiaries at the arm of the cost effective model.Changes in exchange rates present a clear challenge in evaluating the performance of
both the economic units, such as the foreign subsidiaries, as well as the management of
these organizations.❖ CONCLUSION
In this write up the main elements of a methodology to appraise decisions that change
the pattern of future cash flows in the firm has been discussed. We have shown that
shareholder value is maximized if and only if the firm makes only those decisions that
generate positive net present values. Since all criteria are optimal only to the degree that
they agree with the NPV rule, it is best to use the NPV rule rather than anything else.
Hedging can add value if costs of financial distress are significant.