Pricing and Exchange Rates – (2 questions)

PHASE 4 – Pricing and Exchange Rates

PHASE 4 DISCUSSION BOARD – Deliverable Length: approximated 450
words

DUE DATE: agreed to deliver tomorrow morning May
1^st

Instructor
Comments:

“You have to paste
your own Key Assignment Outlined from your Phase 4 Individual Project
(not your assignment but a summary of your Individual Project).  It is necessary for you to familiarize with
the requirements for Individual Project 4.

PHASE 4 INDIVIDUAL PROJECT –
Deliverable Length: 800 – 1,000 words, in additional to the completed table.

DUE DATE:  Tomorrow or Thursday.

Key Assignment Draft 

As a business owner making
a final decision regarding the international aspects of a business decision,
you may decide to set up a table with the risks and weigh their relative
importance against the rate of return you foresee. You also need to put a plan
in place to overcome it.

Assume that your business
is visible and an important member of the community. Would the government
encourage a decision to expand? How would it affect the reputation of the
business?

Here is what the list looks
like. Your assignment is to fill in the table. -à  (Also available in excel attachment)

Risk	Importer	Exporter	L/M/S	How to Overcome It
Economic conditions
Fluctuations in industry
Competition
Technological change
Change in preferences
Costs and expenses
Regulations
Expropriation
Interest rates
Government monetary policy
Government fiscal policy
Internal and external wars
Difference in culture and religion
Ownership of factories and property
Human resource restrictions
Intellectual property
Discrimination
Red tape and corruption
Blockage of funds or capital accounts
Change in government

Comment on whether
the U.S. government would support a business owner’s decision to expand internationally
or import in light of the balance of payments and how the move internationally
may affect the business’s reputation as a local small-business owner.  

Instructor
Comments (TABLE)

L/M/S is an
assessment of the risk. L= Low; M= Moderate; S=Severe.

You need to
identify the risks that affect your particular example, and make an assessment
of their degree using these codes.

Instructor
Comments for Phase 4 Individual Project “the writing part”:

“Individual
Project – Phase 4 you have to think as a business owner, who is considering
doing business with other countries (export or import). You are just going to
focus on risks. There are risks to being an importer and risks to being an
exporter. The point is that although there are risks, it does not mean that
they cannot be managed. They just have to be weighed, and plans must be made to
hedge against them. The students need to identify and describe the risks and
then list whether they will affect them as importer or exporter. Then, the
risks need to be weighed and evaluated. If most of the risk can be managed and
the probability of the others is small, business owners may get more
comfortable with the decision process, and they can proceed to the next step.
In terms of the weight, L means low risk, M means moderate risk, and S means
serious or severe risk.

The other point of
this exercise is to discuss the balance of payments and how governments are
happy to see exports increase in light of a negative balance of payments and
vice-versa. The balance of payments should be explained and how companies can
help stabilize it by exporting more.

Finally, there are
reputation issues to deal with when thinking of going into the global arena,
especially if a business owner is thinking of outsourcing some of its work
overseas. Remember that outsourcing is nothing else than importing services.
The question to answer is how a business owner can maintain the reputation of
his or her company. Here, the students are expected to focus on the benefits of
globalization to businesses on a macro and micro level.

The best way to
approach these questions is by assuming you have a specific business within a
given industry.

PHASE 4 u2013 Pricing and Exchange Rates GUIDELINES – Professor Henry .docx

Phase 4 Individual Project – TABLE – Professor Henry.xlsx