STRAYER ITB400 WEEK 3 AND WEEK 4 DISCUSSIONS

WEEK 3 DISS 1

Please respond to the following:

Use the Internet to research recent causes for fluctuations in purchasing power parity. Provide specific examples.
Discuss the implications of the deviations from purchasing power parity for countries’ competitive positions in the world market.

WEEK 3 DISS 2

Pleaserespond to the following:

Explain the basic differences between the operation of a currency forward market and a futures market. Provide an example of how the forward or future markets work.

WEEK 4 DISS 1

Please respond to the following:

1. Review the definitions of transaction exposure and economic exposure. How are they different?
2. Discuss and compare hedging transaction exposure using the forward contract vs. money market instruments. When do the alternative hedging approaches produce the same result?

WEEK 4 DISS 2

Please respond to the following:

General Motors exports cars to Spain, but the strong dollar against the Euro hurts sales of GM cars in Spain. In the Spanish market, GM faces competition from Italian and French car makers, such as Fiat and Renault, whose operating currencies are the Euro. From the second e-Activity, determine the best course for GM to take to maintain its market share in Spain. Explain your rationale.
Discuss the advantages and disadvantages of maintaining multiple manufacturing sites as a hedge against exchange rate exposure.