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Determining the exchange rate for the currency

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Reference no: EM132818024

You are considering building a factory to build baseball bats to sell in the United States. Assuming the costs are the same in every country and are all in local currency, which of the following is true:

a. You would prefer to build the factory in a country where you expect its currency to weaken relative to the dollar

b. You would prefer to build the factory in a country where you expect its currency to strengthen relative to the dollar

c. The factory location does not matter because the selling price in USD must adjust to the exchange rate for the currency where your plant is located and the USD.

d. You do not have currency risk if you are a U.S. based company selling your finished product in the U.S

Reference no: EM132818024

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