Write a 250-500-word analysis in which you examine the issue of currency exchange and the risks associated with changes in the exchange rate.
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Introduction
Fluctuations in currency exchange rates can have significant effects on business costs, asset values, and profitability. Therefore, it is important for managers to be familiar with exchange rates and currency considerations and to understand the risks involved in currency exchange.
Currency Exchange Risks
Complete the following:
Examine the concept of the exchange rate between the Japanese yen and the U.S. dollar. Choose a Japanese company, such as Toyota, Canon, or Mitsubishi, and identify a strategy that the company might consider to reduce its currency exchange risk associated with Japanese and U.S. currencies.
Write an analysis in which you include the following:
Identify the exchange rate of the Japanese yen and the U.S. dollar.
Discuss the resulting value of selling goods in the United States exported from Japan.
Explain how weekly changes in the exchange rate would affect profitability for exports from Japan to the United States.
Identify risks related to changes in the exchange rate from a management perspective.
Support your analysis with references from the Capella University Library, GlobalEDGE website, or other Internet sources.
Additional Requirements
Use the following guidelines when writing your analysis:
Length: 250–500 words.
Writing: Your analysis should be free of grammar and spelling errors, demonstrating strong written communication skills.
Format and References: Use proper APA-formatted references and in-text citations when identifying your sources.
Competencies Measured
By successfully completing this assessment, you will demonstrate your proficiency in the course competencies through the following assessment scoring guide criteria:
Competency 4: Assess the feasibility of business operation in other countries.
Analyze the exchange-rate-based value of selling goods in the United States exported from a different country.
Explain how changes in the exchange rate would affect profitability for exports from a different country to the United States.
Identify risks related to changes in the exchange rate from a management perspective.
