Currency Essay

Q1. What gives rise to the currency exposure at AIFS? * Currency exposure is the extent to which the future cash flows of an enterprise, arising from domestic and foreign currency denominated transactions involving assets and liabilities, and generating revenues and expenses, are susceptible to variations in foreign currency exchange rates. * AIFS organizes educational and cultural exchange programs throughout the world. AIFS receives most of its currencies in American dollars (USD but

Hedging Currency Risks at AIFS Risk is an inherent aspect of every business activity and its effective management can determine the success or failure of a company. Companies dealing with foreign currencies are at a risk of significant losses caused by fluctuations in the exchange rates. The American Institute for Foreign Study (AIFS) operates in more than one currency and this exposes it to currency risks. The company incurs its expenses in dollars but receives its revenue in other currencies and,

the value of any traditional ‘fiat’ currency. After all it is just paper isn’t it? All modern paper currency today has value because they backed by the government. People are confident that others will hold money to its face value because it has a powerful authority backing and regulating it. For example, the US Dollar has its value determined by treasury notes, exchange rates and foreign exchange reserves. Putting it simply trust is the backbone of modern currency. There must be an unshakable trust

holding Sovereign currencies as reserve currencies Mina Jiang (mj86), the University of Akron Research Summary This research is devote to study different risks of one country holding sovereign currencies such as dollar, euro and yen as its reserve currencies. In general, there may have three kinds of risks, which include inflation risk, the exchange risk and the seignorage risk. It also tries to explain the effects of these risks on the reserve country from the perspective of currency resource allocation

From commodity money to digital currency & advantages and disadvantages of different forms of money 1. Introduction Throughout the history we can see different standards of values and structures of using money, for example commodities (gold, silver, cooper, salt), paper money, credit card, mobile phone banking services via SMS, Euro currency in 23 countries, Bitcoin or most latest Facebook Credits. There was an interesting and very accurate assumption made by J. Surowiecki (2012), he wrote that

Foreign Exchange & foreign currency is the elastic link between various independent political states. The Central Bank of a country frames the monetary policy to maintain a desirable Foreign exchange rate & regulate the flow of foreign currency in an economy. Now let us understand the correlation & interplay between foreign currency & the various economic parameters. In a floating regime of exchange rates, the interest rates in the country are adjusted so as to vary its real exchange rates & also

consumption of goods and services called the economy. The economic activities allow each country to have its currency valued against other currencies and this is called exchange rate. When you borrow money, there is a charge that you pay in return on top of the borrowed amount called interest. Interest is usually calculated as per annum and it influences exchange rates. The value of a country’s currency is affected by a cocktail of activities such as political stability, productivity, inflation and many

result of a stronger yuan. The United States has enjoyed being its currency being the world standard for many decades, but as other countries like China gain on the US economically there is a movement to change the US dollar’s status. Just a few months ago China and Japan announced that the two countries will begin trading currencies directly instead of using the US dollar as an intermediary Wal-Mart can prepare by hedging against currency fluctuations. If it hedges in anticipation of a yuan appreciation

History of Electronic and Virtual Currencies Emerging Cryptocurrencies Attributes of Cryptocurrencies Technology behind Cryptocurrencies Risks to Cryptocurrencies Business and Institutional Adoption of Cryptocurrencies Future Alternative Uses of Cryptocurrencies# History of Electronic and Virtual Currencies Traditionally, currencies have been tied to physical tangible items, such as paper or gold, and provided three functions: a medium of exchange, a unit of account, and a store of value. The

PLEKHANOV RUSSIAN ECONOMIC UNIVERSITY INTERNATIONAL FINANCIAL MANAGEMENT Case Study REPORT Hedging Currency Risks At AIFS Professor: Yulia Y.Finogenova Performed by: Budeanu Diana Gabaydullin Ilnar Kulikova Ekaterina