Quiz 18: Global Operations and Supply Chain Management

Business

The commercial activities that cross national borders are known as international business. The goods, services, technology, personnel etc. all are moved from one country to another and also to many countries and vice versa. This movement is known as import and export in layman language. It is generally done through various modes of entry like licensing, franchising etc. The profiting from microloans to the poor is ethical only when they are charged a very minimal amount of interest on the landed money because it helps the lenders to pay the lending fees and taxes as well as help to give microloans to others.

The commercial activities that cross national borders are known as international business. The goods, services, technology, personnel etc. all are moved from one country to another and also to many countries and vice versa. This movement is known as import and export in layman language. It is generally done through various modes of entry like licensing, franchising etc. The following options are available to cover the risks: 1. Currency Option hedge: It is the technique used to protect from the losses occur due to currency fluctuations. This option provides the holder to enter into the market at a specific price allows the seller to buy or sell the currency at a specific rate of exchange. 2. Money market hedge: In this option, the holder trade in highly liquid and short instruments of the money market, includes Treasury bills, commercial paper etc. 3. Forward market hedge: In this option, the financial assets or instruments are set at the price of future rates. 4. Exposure netting: It is the method of reducing currency risks by offsetting exposure in one currency with exposure in another or same currency. 5. Lending and Lagging: The exporter should do the transactions through lending (making a payment earlier) or lagging (making payments late), depends on the movement of currency.

This is an opinion question that encourages students to think through the way culture impacts all aspects of international activity. The alternative explanation is certainly a possibility.