What are the risks of floating exchange rates and make a comparison to the risks in...

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General Management

What are the risks of floating exchange rates and make acomparison to the risks in the situation of a host country changingits political system and/or a host country changing its economicsystem. The key is that something has changed and that creates arisk. These areas of business risks do not usually appear with asolely domestic business, but can in an international business.Discuss the impact of these potential risks on an internationalbusiness and how management must be vigilant.

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Floating exchange rate means that the host countrys currency value fluctuates as a response to the foreignexchange market As floating rates automatically adjust to the global influences hence they enable the country to dampen the effects of the business cycles and shocks The biggest risk that floating rates See Answer

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