Choose an international company (not based in the United States) on which to base your discussion. Reflect on the company, the concepts in the unit, and the current economic environment in which the company operates, and consider the current exchange rate.
Imagine that you are a manager in the company you have chosen. Your boss has asked you to forecast the exchange rates of the company with the United States and assess its transaction, economic, and translation exposure. What motive might your boss have for wanting to forecast exchange rates?
Discuss the technique you feel would be most useful in forecasting the exchange rate for your company, and explain why you chose this technique. Based on your assessment, do you feel your firm’s transaction, economic, or translation exposure is high or low? Explain.