Question: What are some risks associated with doing business internationally? Given these risks, why do companies engage in international business? Explain the difference between a spot

  1. What are some risks associated with doing business internationally? Given these risks, why do companies engage in international business?
  2. Explain the difference between a spot and a forward rate of exchange.
  3. If Citigroup, based in the United States, makes loans to a German corporation in Euros, which would benefit the most from a weaker or stronger U.S. dollar? Explain.
  4. Briefly discuss how an increase in the value of the U.S. dollar would impact
  1. A US investor with significant foreign investments
  2. A foreign investor with significant US investments
  3. The U.S. consumer
  4. A US-based manufacturer that sells its products internationally
  5. A foreign-based manufacturer that sells its products in the US.

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