- Assess the current market risk in the U.S. and Foreign Markets, indicating how a financial manager is likely to react given the risk level determined. Provide support for your answer.
- Considering the market risks of interest rate, foreign exchanges, and commodity price risk, assess the risk that you believe may have the most significant impact on a firm. Indicate how this risk can be managed effectively to minimize the effects of this risk.
- Please provide one citation/reference for your initial posting that is not your textbook. Please do not use Investopedia or Wikipedia.
- *** 150 + WORDS ***
Part 2: Respond to classmate below:
“Right now in the United States, we have trade frictions with China and the inability of Congress to pass a budget. Investors worry that the trade war between the United States and China could start to pinch corporate earnings and economic activity more than it has to date. A financial manager has to learn about the risks of investing and do their homework on individual investments, this will allow them to make decisions that will help them meet their financial goals.
Businesses face all kinds of risks, some of which can cause serious loss of profits or even bankruptcy. Everyone knows that a successful business needs a comprehensive, well-thought-out business plan. But it’s also a fact of life that things change. One of the biggest risks is strategic risk. It’s the risk that your company’s strategy becomes less effective and your company struggles to reach its goals as a result. It could be due to technological changes, a powerful new competitor entering the market, shifts in customer demand, spikes in the costs of raw materials, or any number of other large-scale changes.”