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Homework answers / question archive / Just-for-Kids, Inc
Just-for-Kids, Inc., is a toys and clothes manufacturer based in San Diego, California. The company has received an inquiry from an overseas company to do business. Tom Dodd is the owner of the company researching the opportunity and how exchange rates will affect its international business activities.
If Just-for-Kids is selling in a country with a strong currency while sourcing from a country with a weak currency, it will most likely:
A) improve its profits
B) face U.S. government penalties
C) generate losses
D) engage in unethical conduct
The answer is A) improve its profits. The U.S. based firm will benefit from increased sales in the country with the strong currency and bargain purchases in the country with the weak currency.
