Answer:
The correct answer is c. reduces; reduce.
Explanation:
Economic exposure is a type of exposure to exchange rate risk caused by the effect of unexpected currency fluctuations on a company's cash flows, foreign investment, and future earnings.
Economic exposure, also known as operating exposure, can have a substantial impact on a company's market value, as it has far-reaching effects and is long-term in nature. Companies can protect themselves against unexpected currency fluctuations by investing in currency markets (FX).
Unlike transaction exposure and conversion exposure (the other two types of currency exposure), economic exposure is difficult to measure accurately and therefore difficult to hedge. Economic exposure is also relatively difficult to hedge because it faces unexpected changes in exchange rates, unlike expected changes in exchange rates, which form the basis of companies' budget forecasts.
Answer: The equilibrium price of lcd tvs will
a. Increase and the equilibrium quantity will increase.
When the price of a substitute of lcd tvs rise, the demand for lcd tvs will rise, since they become cheaper than the substitute.
This will cause the existing demand curve to shift outwards, resulting in a rise in quantity.
As a result of the outward shift, the quantity supplied will also rise and so will the equilibrium price.
The answer is globalization.
This is when you are now bringing your economy from domestic to
international level where you are now engaging in business transactions with other
countries overseas. There will be many hurdles but these are necessary when
competing in the global market.
Answer:
Listing the consequences of each option.
Explanation:
Answer:
Correct option is C
<u>Overall operating income will decrease by $25,000.</u>
Explanation:
Sales ratio = Sales of product 1 : Sales of product 2 = 200,000:300,000 = 2:3
Sum of sales ratio = 2+3 = 5
Common fixed cost:
Product 1 = 2/5×46,000 = $18,400
Product 2 = 3/5×46,000 = $27,600
Total net operating income = Net operating income of product 1 + Net operating income of product 2 = 46,600+(2,600) = 46,600-2,600 = $44,000
Now, comparing with the total net operating income of both the product ($44,000) with only product 1 ($19,000); overall operating income decreases by $25,000 (44,000-19,000)
