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Let's take a big US multinational company, which sells its products all over the world. The currency for production costs and the balance sheet is logically in US Dollars. However, the receipts from sales come in all sorts of currencies: Yen, Deutschmarks, French Francs, Australian Dollars, Swedish Kroner and so forth. In order to remain competitive, the products are sold in various countries at prices which cannot change every day. Unfortunately the currency rates do. If the US Dollar in this particular scenario gets stronger, this US multinational company will make a loss, as, the Yen, Deutschmarks etc. paid, will buy less Greenbacks. It is not uncommon for international sales profits to be wiped out by adverse currency moves. On the other hand, if the US Dollar weakens and the Yen, Deutschmarks etc.
Approximate Word count = 514
Approximate Pages = 2.1
(250 words per page double spaced)
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