Summer1 Digital (Summer1) is a multinational corporation that produces and distributes telecommunications technology. Although its corporate headquarters are located in Kuala Lumpur, Malaysia, Summer1 usually buys its materials in several different countries using several different foreign currencies. The matter is further complicated because Summer1 often sells its products in other foreign countries. Summer1 is concerned with economic conditions that could adversely affect ringgit exchange rates. Explain Malaysias economic conditions in 2021. Evaluate the risks that need to be considered by Summer1 if it decides to continue buying materials from other countries including China and Indonesia as well as selling its products in countries such as Hong Kong and Japan. Discuss ways to manage and minimise the impacts of the risks associated with Techno1’s materials purchase and products sales in the foreign countries.

Summer1 Digital (Summer1) is a multinational corporation that produces and distributes telecommunications technology. Although its corporate headquarters are located in Kuala Lumpur, Malaysia, Summer1 usually buys its materials in several different countries using several different foreign currencies. The matter is further complicated because Summer1 often sells its products in other foreign countries. Summer1 is concerned with economic conditions that could adversely affect ringgit exchange rates. Explain Malaysias economic conditions in 2021. Evaluate the risks that need to be considered by Summer1 if it decides to continue buying materials from other countries including China and Indonesia as well as selling its products in countries such as Hong Kong and Japan. Discuss ways to manage and minimise the impacts of the risks associated with Techno1’s materials purchase and products sales in the foreign countries.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter29: Exchange Rates And International Capital Flows

Section: Chapter Questions

Problem 20RQ: How can an unexpected fall in exchange rates injure the financial health of a nations banks?

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