国际商务 查尔斯w.l.希尔 第七版 原版官方pptchap009.ppt

International Business 7e by Charles W.L. Hill Chapter 9 The Foreign Exchange Market Introduction A firm’s sales, profits, and strategy are affected by events in the foreign exchange market The foreign exchange market is a market for converting the currency of one country into that of another country The exchange rate is the rate at which one currency is converted into another The Functions Of The Foreign Exchange Market The foreign exchange market: is used to convert the currency of one country into the currency of another provide some insurance against foreign exchange risk (the adverse consequences of unpredictable changes in exchange rates) Currency Conversion International companies use the foreign exchange market when: the payments they receive for exports, the income they receive from foreign investments, or the income they receive from licensing agreements with foreign firms are in foreign currencies they must pay a foreign company for its products or services in its country’s currency they have spare cash that they wish to invest for short terms in money markets they are involved in currency speculation (the short-term movement of funds from one currency to another in the hopes of profiting from shifts in exchange rates) Insuring Against Foreign Exchange Risk The foreign exchange market can be used to provide insurance to protect against foreign exchange risk (the possibility that unpredicted changes in future exchange rates will have adverse consequences for the firm) A firm that insures itself against foreign exchange risk is hedging Insuring Against Foreign Exchange Risk The spot exchange rate is the rate at which a foreign exchange dealer converts one currency into another currency on a particular day Spot rates change continually depending on the supply and demand for that currency and other currencies Classroom Performance System The ________ is the rate at which one currency is converted into another. a) Exchange rate b) Cross