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Exchange rates' performance in the long run is a litmus test for any country as to the efficacy of economic management. That is true of the ringgit, rupiah, and other currencies. Ringgit was pegged to the British pound when the Sterling was the darling of central banks in the post-waryears to 1960s, of which later Malaysia switched to the US dollar in 1970s using later a version of trade-weighted basket management. At the time of its shift, RM2.50 could buy one US dollarcompared to RM4.35 as of May 2020 in the face of Covid-19 pandemic.
a) Briefly describe two ways on how exchange rates influence business activities.
b) Explain how Malaysian Ringgit adjusts to inflation based on purchasing power parity.
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Mountain Man Brewing, a family owned business where Chris Prangel, the son of the president joins. Due to increase in the preference for light beer drinkers, Chris Prangel wants to introduce light beer version in Mountain Man. An analysis into the la..
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