Week 6 Engagement Currency Risk (112)

Currency risk is inherent in almost all things sourced from overseas i.e. are imported.

For each of the instances below, write a paragraph (one for each instance) on how the business might deal or “solve” currency risks more specifically when the item being imported suddenly costs considerably more (assume 10% more) in U.S. Dollars.

Hershey Candy Bars sold via vending machines – Candy bars contain chocolate which is imported and comprises half the cost of the product
A Los Angeles to London airline ticket on British Airways where the salary of the flight crew and landing fees paid to the London Airport etc comprise 50% of the cost of transportation
Nike basketball shoes made in Vietnam where 100% of the cost of labor and materials is paid for in the local Vietnamese currency (Dong)