Abstract

<p class="MsoNormal" style="text-align: justify; margin: 0in 0.5in 0pt;"><span style="font-family: Times New Roman; font-size: x-small;">This paper utilizes a game-theoretical framework to analyze managerial behavior in the context of choosing foreign currency translation methods. The aforementioned problem can be constructed as a model of decision-making under uncertainty. The results of this analysis are as follows: adopt the current rate method when managerial compensation is a function of reported accounting earnings; conversely the temporal method should be employed when managerial compensation takes the form of stock options.</span></p>

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