While there are many factors that lead to an organization's success
or failure, it is important to identify the risk associated with the
endeavor—financial or non-financial. Once the risks have been
identified, management has a responsibility to develop measures to
mitigate those risks.
Tasks:
Use the publicly-traded company you chose in Module 1
and imagine it has made a strategic decision to start doing business in
China. Using the discussion, Currency Exchange Rates: A Case in China
with Country Risk, (Chapter 7, Global Finance, page 192 of your textbook) as a model for the report you will write, prepare a report in which you:
----->*Please the publicly-traded company that I chose in M1 Assignment is "Wells Fargo & Company"
- Develop a brief country risk assessment.
- Determine the political, economic, social, and capital risks associated with doing business in China. What are the most important factors to consider? Why?
- After years of keeping the Yuan pegged to the US dollar, in 2015
the Chinese allowed it to float freely in international currency
exchange rate markets. You may read more about the Yuan reforms
here. Many economists believe that keeping the Yuan pegged to the US
dollar has caused it to be undervalued by 30 to 50 percent. Discuss what
impact a revaluation of the Yuan might have on US multinationals doing
business there, on China’s exports, and on Chinese citizens’ standard of
living. What impact would a revaluation have on Chinese inflation and
on purchasing power parity? Explain.
Your paper should be about 2,000 words.
Field of study:
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