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    Country risk and the foreign exchange market

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    Question 1. Please describe what country risk analysis is and how it can be conducted? Also, is country risk analysis an effective tool in determining the desirability of establishing a manufacturing site or other mode of entry?

    Question 2. Please describe the primary functions of the foreign exchange market? How do global companies use the foreign exchange market to hedge against foreign exchange risks?

    I am having a problem getting these questions started. I have to write about 1 to 1.5 pages (double spaced) on each question.

    © BrainMass Inc. brainmass.com May 20, 2020, 3:59 pm ad1c9bdddf
    https://brainmass.com/business/international-business-risk/country-risk-and-the-foreign-exchange-market-153126

    Solution Preview

    An analysis of the various types of risks that can arise due to conducting business in a particular nation, such as social, cultural, political and legal risks and the possible impact of such risks on conducting business can be termed as country risk analysis. Country risks provide a comprehensive overview of the pros and cons of conducting business in a particular nation. In other words, it provides a comprehensive information about the various positive and negative factors about doing business in the nation. It is basically determining the country's

    The most appropriate technique, strategy to conduct country risk analysis varies from nation to nation as well as industry to industry. One needs to chose a technique on the relative importance of various risk factors to the particular business or industry. For example, some businesses are more affected by political risks than others. Similarly, for some businesses, cultural risks are the most important and political risks do not pose much threat. Thus, one needs to focus on these individual components on the basis of the their business ...

    Solution Summary

    Please describe what country risk analysis is and how it can be conducted? Also, is country risk analysis an effective tool in determining the desirability of establishing a manufacturing site or other mode of entry?

    $2.19

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