31 Global Expansion and Uncertainty

Question 1

Define appreciation

Answer 1

a rise in the value of a country’s currency

Question 3

Define depreciation

Answer 3

a fall in the value of a country’s currency

Question 4

How does appreciation affect exporters and importers?

Answer 4

exporters: fall in demand, more expensive
importers: rise in demand, cheaper

Question 5

How does depreciation affect exporters and importers?

Answer 5

exporters: rise in demand, cheaper
importers: fall in demand, expensive

Question 6

Define competitive advantage

Answer 6

the advantage of one firm has over its competitors in providing certain products

Question 7

Define economic risk

Answer 7

the risk that future cash flows will change due to unexpected exchange rate changes

Question 8

Define international competitiveness

Answer 8

the extent to which a business such as a country can compete successfully against rivals

Question 9

Define skill shortages

Answer 9

where potential employees do not have the skills demanded by employers