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    how the firm prices its revenues and costs

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    Select a U.S. multinational company. In terms of currency denomination, discuss how the firm prices its revenues and costs. For MNE's with multiple foreign operations, consider any one of those operations and the contribution it is making to the parent firm's profits. Using this information, what do you think would be the effect of increases/decreases in the dollar's exchange value on the firm's profitability? Be sure to show all applicable work. Please Give references if you can.

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    Solution Preview

    For the purpose of this assignment, I will select US Multinational Google Corporation. Google has set up extensive operations in India for several back office processes, research and analytics work and other outsourced operations. Google has hired several thousand employees to take advantage of huge pool of educated and English speaking workforce in India which is available at much lower costs as compared to workers in United States. Further, India is quite important market for Google's service such as Adwords and Adsense as India is one of the fastest growing and largest economies in the world and offer tremendous growth opportunities for Google.

    The revenues and costs of Google are priced in India's currency, ie, Indian rupee terms but since Google is a US based corporation and India's operations are conducted under the ...

    Solution Summary

    Select a U.S. multinational company. In terms of currency denomination, discuss how the firm prices its revenues and costs

    $2.19