Analyze the major exchange rate risks associated with transaction and translation exposure within the Chinese market.

ReyWriter

Select one (1) MNC that does not currently do business in China. Next, consider the steps that the company should consider in determining the feasibility of entering the Chinese market and establishing a market for its products or services there.

 

In addition to your own research, use the following links to conduct a country risk assessment (CRA) on China:

Focus on the following areas: corruption, political stability, exchange rate stability, regulatory oversight, freedom of the press, and rule of law. Research other factors that you believe you should evaluate. Additionally, consider the importance of culture in evaluating risk.

Then, go to the Hofstede Center’s Country Comparison cultural tool, located at http://geert-hofstede.com/china.html. Compare China to the U.S. on Hofstede’s six (6) key cultural dimensions scale by selecting “United States” from the “Comparison Country” drop-down menu.

 

Write an eight to ten (8-10) page paper in which you:

  1. Summarize the business that you have chosen, and provide a two to three (2-3) paragraph justification as to why China would be a viable market for the selected business.
  2. Examine the exchange rate of the U.S. dollar and the Chinese Yuan for the last 24 months. Explain the major overall changes that have occurred and speculate on the key economic variables that most likely have influenced the exchange rate movements. Provide a rationale for your response.
  3. Analyze the major exchange rate risks associated with transaction and translation exposure within the Chinese market. Based on what you have gleaned from your analysis, predict the major changes that you believe will occur in the next 24 months. Justify your response.
  4. Recommend key steps that the chosen MNC could take in order to mitigate or eliminate exchange rate risk. Suggest one (1) method that the MNC in question could use with derivatives in order to mitigate, or eliminate such risks. Provide a rationale for your response.
  5. Recommend one (1) hedging technique geared toward managing the economic, transaction, and translation exposure in the Chinese market. Justify your response.
  6. Conduct a country risk assessment to ascertain whether or not management should support the proposal for your chosen MNC to enter into the Chinese market. Based on Geert Hofstede’s six (6) dimensions of culture, predict three (3) likely problems posed by the cultural differences between the chosen MNC’s culture and the Chinese culture. Provide a rationale for your response.
  7.  Use at least six (6) quality references, with at least two (2) from peer reviewed journal articles.

 

 

Your assignment must follow these formatting requirements:

  • Be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides; citations and references must follow APA or school-specific format. Check with your professor for any additional instructions.
  • Include a cover page containing the title of the assignment, the student’s name, the professor’s name, the course title, and the date. The cover page and the reference page are not included in the required assignment page length.

 

The specific course learning outcomes associated with this assignment are:

  • Evaluate the major international financial markets to determine effective methods for financing global business operations.
  • Analyze the economic variables that influence exchange rate movements and equilibrium price to anticipate fluctuations, and minimize the negative impact on international business operations.
  • Formulate strategies to use currency derivatives for foreign exchange risk management and for speculation by multinational corporations.
  • Analyze the exchange rate risks associated with transaction, economic, and translation exposure in global markets, and develop risk management strategies to minimize the impact on international business operations.
  • Apply a hedging technique to manage the risks of transaction, economic, and translation exposures.
  • Use technology and information resources to research issues in international finance.
  • Write clearly and concisely about international finance using proper writing mechanics.

 

Grading for this assignment will be based on answer quality, logic / organization of the paper, and language and writing skills, using the following rubric.

Points: 300 Assignment 1: MNC Enters China
Criteria Unacceptable

Below 70% F

Fair

70-79% C

Proficient

80-89% B

Exemplary

90-100% A

1. Summarize the business that you have chosen, and provide a two to three (2-3) paragraph justification as to why China would be a viable market for the selected business.

Weight: 5%

Did not submit or incompletely summarized the business that you have chosen, and did not submit or incompletely provided a two to three (2-3) paragraph justification as to why China would be a viable market for the selected business. Partially summarized the business that you have chosen, and partially provided a two to three (2-3) paragraph justification as to why China would be a viable market for the selected business. Satisfactorily summarized the business that you have chosen, and satisfactorily provided a two to three (2-3) paragraph justification as to why China would be a viable market for the selected business. Thoroughly summarized the business that you have chosen, and thoroughly provided a two to three (2-3) paragraph justification as to why China would be a viable market for the selected business.
2. Examine the exchange rate of the U.S. dollar and the Chinese Yuan for the last 24 months. Explain the major overall changes that have occurred and speculate on the key economic variables that most likely have influenced the exchange rate movements. Provide a rationale for your response.

Weight: 15%

Did not submit or incompletely examined the exchange rate of the U.S. dollar and the Chinese Yuan for the last 24 months. Did not submit or incompletely explained the major overall changes that have occurred and did not submit or incompletely speculated on the key economic variables that most likely have influenced the exchange rate movements. Did not submit or incompletely provided a rationale for your response. Partially examined the exchange rate of the U.S. dollar and the Chinese Yuan for the last 24 months. Partially explained the major overall changes that have occurred and partially speculated on the key economic variables that most likely have influenced the exchange rate movements. Partially provided a rationale for your response. Satisfactorily examined the exchange rate of the U.S. dollar and the Chinese Yuan for the last 24 months. Satisfactorily explained the major overall changes that have occurred and satisfactorily speculated on the key economic variables that most likely have influenced the exchange rate movements. Satisfactorily provided a rationale for your response. Thoroughly examined the exchange rate of the U.S. dollar and the Chinese Yuan for the last 24 months. Thoroughly explained the major overall changes that have occurred and thoroughly speculated on the key economic variables that most likely have influenced the exchange rate movements. Thoroughly provided a rationale for your response.
3. Analyze the major exchange rate risks associated with transaction and translation exposure within the Chinese market. Based on what you have gleaned from your analysis, predict the major changes that you believe will occur in the next 24 months. Justify your response.

Weight: 15%

Did not submit or incompletely analyzed the major exchange rate risks associated with transaction and translation exposure within the Chinese market. Did not submit or incompletely predicted the major changes that you believe will occur in the next 24 months based on what you have gleaned from your analysis. Did not submit or incompletely justified your response. Partially analyzed the major exchange rate risks associated with transaction and translation exposure within the Chinese market.  Partially predicted the major changes that you believe will occur in the next 24 months based on what you have gleaned from your analysis. Partially justified your response. Satisfactorily analyzed the major exchange rate risks associated with transaction and translation exposure within the Chinese market. Satisfactorily predicted the major changes that you believe will occur in the next 24 months based on what you have gleaned from your analysis. Satisfactorily justified your response. Thoroughly analyzed the major exchange rate risks associated with transaction and translation exposure within the Chinese market. Thoroughly predicted the major changes that you believe will occur in the next 24 months based on what you have gleaned from your analysis. Thoroughly justified your response.
4. Recommend key steps that the chosen MNC could take in order to mitigate or eliminate exchange rate risk. Suggest one (1) method that the MNC in question could use with derivatives in order to mitigate, or eliminate such risks. Provide a rationale for your response.

Weight: 15%

Did not submit or incompletely recommended key steps that the chosen MNC could take in order to mitigate or eliminate exchange rate risk. Did not submit or incompletely suggested one (1) method that the MNC in question could use with derivatives in order to mitigate, or eliminate such risks. Did not submit or incompletely provided a rationale for your response. Partially recommended key steps that the chosen MNC could take in order to mitigate or eliminate exchange rate risk. Partially suggested one (1) method that the MNC in question could use with derivatives in order to mitigate, or eliminate such risks. Partially provided a rationale for your response. Satisfactorily recommended key steps that the chosen MNC could take in order to mitigate or eliminate exchange rate risk. Satisfactorily suggested one (1) method that the MNC in question could use with derivatives in order to mitigate, or eliminate such risks. Satisfactorily provided a rationale for your response. Thoroughly recommended key steps that the chosen MNC could take in order to mitigate or eliminate exchange rate risk. Thoroughly suggested one (1) method that the MNC in question could use with derivatives in order to mitigate, or eliminate such risks. Thoroughly provided a rationale for your response.
5. Recommend one (1) hedging technique geared toward managing the economic, transaction, and translation exposure in the Chinese market. Justify your response.

Weight: 10%

Did not submit or incompletely recommended one (1) hedging technique geared toward managing the economic, transaction, and translation exposure in the Chinese market. Did not submit or incompletely justified your response. Partially recommended one (1) hedging technique geared toward managing the economic, transaction, and translation exposure in the Chinese market. Partially justified your response. Satisfactorily recommended one (1) hedging technique geared toward managing the economic, transaction, and translation exposure in the Chinese market. Satisfactorily justified your response. Thoroughly recommended one (1) hedging technique geared toward managing the economic, transaction, and translation exposure in the Chinese market. Thoroughly justified your response.
6. Conduct a country risk assessment to ascertain whether or not management should support the proposal for your chosen MNC to enter into the Chinese market. Based on Geert Hofstede’s six (6) dimensions of culture, predict three (3) likely problems posed by the cultural differences between the chosen MNC’s culture and the Chinese culture. Provide a rationale for your response.

Weight: 15%

Did not submit or incompletely conducted a country risk assessment to ascertain whether or not management should support the proposal for your chosen MNC to enter into the Chinese market. Did not submit or incompletely predicted three (3) likely problems posed by the cultural differences between the chosen MNC’s culture and the Chinese culture based on Geert Hofstede’s six (6) dimensions of culture. Did not submit or incompletely provided a rationale for your response. Partially conducted a country risk assessment to ascertain whether or not management should support the proposal for your chosen MNC to enter into the Chinese market. Partially predicted three (3) likely problems posed by the cultural differences between the chosen MNC’s culture and the Chinese culture based on Geert Hofstede’s six (6) dimensions of culture. Partially provided a rationale for your response. Satisfactorily conducted a country risk assessment to ascertain whether or not management should support the proposal for your chosen MNC to enter into the Chinese market. Satisfactorily predicted three (3) likely problems posed by the cultural differences between the chosen MNC’s culture and the Chinese culture based on Geert Hofstede’s six (6) dimensions of culture. Satisfactorily provided a rationale for your response. Thoroughly conducted a country risk assessment to ascertain whether or not management should support the proposal for your chosen MNC to enter into the Chinese market. Thoroughly predicted three (3) likely problems posed by the cultural differences between the chosen MNC’s culture and the Chinese culture based on Geert Hofstede’s six (6) dimensions of culture. Thoroughly provided a rationale for your response.
7. 6 references

Weight: 5%

No references provided. Does not meet the required number of references; some or all references poor quality choices. Meets number of required references; all references high quality choices. Exceeds number of required references; all references high quality choices.
8. Writing Mechanics, Grammar, and Formatting

Weight: 5%

Serious and persistent errors in grammar, spelling, punctuation, or formatting. Partially free of errors in grammar, spelling, punctuation, or formatting. Mostly free of errors in grammar, spelling, punctuation, or formatting. Error free or almost error free grammar, spelling, punctuation, or formatting.
9. Appropriate use of APA in-text citations and  reference section

Weight: 5%

Lack of in-text citations and / or lack of reference section. In-text citations and references are provided, but they are only partially formatted correctly in APA style. In-text citations and references are error free or almost error free and consistently formatted correctly in APA style.
10. Information Literacy / Integration of Sources

Weight: 5%

Serious errors in the integration of sources, such as intentional or accidental plagiarism, or failure to use in-text citations.   Sources are mostly integrated using effective techniques of quoting, paraphrasing, and summarizing. Sources are consistently integrated using effective techniques of quoting, paraphrasing, and summarizing.
11. Clarity and Coherence of Writing

Weight: 5%

Information is confusing to the reader and fails to include reasons and evidence that logically support ideas Information is partially clear with minimal reasons and evidence that logically support ideas  

Are you looking for a similar paper or any other quality academic essay? Then look no further. Our research paper writing service is what you require. Our team of experienced writers is on standby to deliver to you an original paper as per your specified instructions with zero plagiarism guaranteed. This is the perfect way you can prepare your own unique academic paper and score the grades you deserve.

Use the order calculator below and get started! Contact our live support team for any assistance or inquiry.