Evaluate exposure to foreign exchange risk

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Imagine that you are the CEO of a major consumer electronics manufacturer based in the United States. Over the past decade, your company has seen a sharp rise in demand from consumers in oil-exporting nations in South America, Africa, and Eastern Europe. As such, a significant portion of your revenues are in foreign currencies.

Evaluate your exposure to foreign exchange risk. What factors might influence the profits you receive from foreign sales? How might you hedge against these risks?

Reference no: EM132729505

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