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19 Cards in this Set
- Front
- Back
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exchange Rates |
the price of one currency in terms of another currency |
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910 Euros |
if you convert $1000 to euros exchange rates 1$ = .91 euro -> .91euro/dollar 1 euro = 1.1$ -> 1.1 dollar /euro |
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2 differences when doing business internationally |
other countries may have different laws, cultures, and business institutions and may use different currencies |
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foreign exchange market |
the market where one currency is exchanged for another |
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Brazil |
real |
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japan |
yen |
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China |
Yuan |
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Korea |
won |
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bid Rate |
exchange rate when buying currency |
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Ask rate |
exchange rate when selling currency |
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Currency RisK |
uncertainty due to potential future changes in exchange rates |
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Country Risk |
Uncertainty due to potential future changes in the economic environment |
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Increase |
Currency risk and country risk will __________ the hurdle rate for projects in foreign countries making them less attractive
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Reduce |
Currency risk and country risk _______ the attractiveness of these investments and need to be taken into account |
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Country Risk |
Any uncertainties ties to the government, institutions or business environment of the company |
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Examples of Country Risk |
- import/ export extraditions - Capital Controls - Political instability |
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Increase |
if the demand for a specific currency increases, its value __________ relative to other currencies.
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Appreciates |
When a currency increases in value, then that currency ___________ |
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Depreciates
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When a currency decreases in value, then the currency
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