Review Group Problems G11-1: Exchange Rate Effect on Industry and G11-2: Exchange Rate Effects on Your Firm

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Enatry12

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Review Group Problems G11-1: Exchange Rate Effect on Industry and G11-2: Exchange Rate Effects on Your Firm, located at the end of Chapter 11 in Managerial Economics: A Problem Solving Approach. Select one problem that relates to you and your current position in the work environment. Complete your response in 750-1,000 words. Support your response with personal experiences or examples.

Alternate Scenario: If you are in an industry that does not deal with any foreign exchange transactions, use the petroleum industry for this assignment. Imagine that you work for a domestic oil refinery, and answer either question G11-1 or G11-2. You do not work for an oil producer, but rather for a refinery, which turns crude oil into many different petroleum products, from jet fuel to gasoline, which are then sold to world markets. You have the option of purchasing crude oil from U.S. sources or from various foreign countries. You must purchase crude oil in order to make products that you can sell in the United States or in other countries.

Prepare this assignment according to the guidelines found in the APA Style Guide, located in the Student Success Center. An abstract is not required.

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Maybe since you do not know details about my current position you may do the Atlernate option listed.

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Running head: EXCHANGE RATE EFFECT ON OIL REFINERY INDUSTRY

EXCHANGE RATE EFFECT ON OIL REFINERY INDUSTRY
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EXCHANGE RATE EFFECT ON OIL REFINERY INDUSTRY

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Exchange Rate Effect on Oil Refinery Industry
Exchange rates play a critical role in the operations of firms that import raw materials and
export finished products. Devaluation or depression often reduces the coast of export making it
cheaper hence making exporting firms to benefit. However, this will result into higher import
costs for raw materials. An appreciation in the rate of exchange often makes raw materials
import for oil cheaper. Studies have established that foreign exchange is often considered as a
risk that may work to either the advantage or disadvantage of an organization (Kilian, 2009). The
exchange rate often does not affect the importation of crude oil as a raw material since it is
priced in the foreign market in a single currency which is the US dollar. The aim of this paper is
to shed light on the influence and impact of exchange rates on oil refinery firms.
Oil e...


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