Factors that Influence the Volatility in Exchange Markets in China Research Paper

Factors that Influence the Volatility in Exchange Markets in China - Research Paper Example Factors that Influence the Volatility in Exchange Markets in China Foreign exchange influences the countries ability to conduct business relations with its trading associates. Therefore, the factors, which control the exchange patterns of a countries currency, become vital to it. Considering this, the Central banks have the mandate of monitoring the exchange fluctuations of the currency. It is in a position to instill stability of the currency by tightening the financial policies of exchange rates of banks and bureaus. The first role includes the â€Å"transfer function† which is essential in facilitating the transfer of the purchasing capacity of the trading countries. For example, if the exchange rate US is superior to that of China, for instance 2.68 Yuan: 1$, the Chinese firms will incur more to import from US. The second is the â€Å"credit function† role that entails the provision of credit for foreign trade. The transfer of commodities takes time, and this transit period requires financing. The trader’s exchange agents and banks furnish the foreign traders with credit facilities to facilitate trade. Thirdly, the exchange rates assist in hedging against the variation of the currency markets. The exchange rates market has structures that importers and exporters can use to evade the excessive costs and risks of exchange rate patterns. Hedging enables corporations evade the exchange risks through exchange agreements by using the following rates: Fixed exchange rates, Forward exchange rate and Spot rate. Relevance of Spot Exchange Rate (SER) in exchange markets The spot rate is the existing transfer rate of foreign currencies in comparison to the home currency (Wang, 2009). This rate is determines by the existing economic situations in a country. Interestingly, the political circumstances of the country also have a considerable effect on the exchange rates. Therefore, changes in the fu ture expectations can disrupt the current spot rate. Miller (2002) suggests Spot rates are crucial since they depict the

Mcdonalds Organizational Analysis Research Paper

Mcdonalds Organizational Analysis - Research Paper Example McDonald Company was created in 1937by Richard and Maurice McDonald, at a tiny drive-in restaurant east of Pasadena, California (Tassiopoulos, 2008). It’s a multinational company with head offices in 52 countries. Its first franchise was in 1954 by a man known as Roy Kroc, who was given an exclusive deal to franchise McDonald in America. There are over 11,000 restaurants in over 60 countries serving 22million customers. McDonald Company has expanded that it is not only a hamburger company, but it has also become a real estate company (Tassiopoulos, 2008). Since 1954 McDonald has gained 22427 franchised units.McDonalds expansion outside the United States began in 1967, and â€Å"by the early 1990’s, it had 3,600 operations in 58 countries†. The company began with French fries, hamburgers, cheeseburgers, and soft drinks. Over the years, the company has also introduced other products, with some being successful in the market and others lacking customer approval. Amo ng the successful products are the Fish sandwich, ready to eat salads, Chicken McNuggets, McFlurry desserts, and McMuffin, while those that lacked approval include the pasta, pizza, fajitas, fried chicken, McLean Deluxe sandwich, and the Deluxe and Arch Deluxe burgers (Julian, 2006).Technology has always been at the focal point of the McDonald’s company making it top among competitors, and giving it the ability to always provide quality products. The company has also been very aggressive in engaging in promotional activities.... Over the years, the company has also introduced other products, with some being successful in the market and others lacking customer approval. Among the successful products are the Fish sandwich, ready to eat salads, Chicken McNuggets, McFlurry desserts, and McMuffin, while those that lacked approval include the pasta, pizza, fajitas, fried chicken, McLean Deluxe sandwich, and the Deluxe and Arch Deluxe burgers (Julian, 2006). Technology has always been at the focal point of the McDonald’s company making it top among competitors, and giving it the ability to always provide quality products. The company has also been very aggressive in engaging in promotional activities aimed at marketing the products and expanding the market share(Julian, 2006). The company has maintained good values since its establishment, especially in protecting the environment. Julian points out that â€Å"one notable effort: wrapping hamburgers in paper instead of plastic resulted in a 90 percent decrea se in waste† (2006, p. 645). The diversity in the workforce of McDonald’s has been a great base to gaining and maintaining a huge and diverse customer base. People with disabilities, as well as those of all races and ethnicities are represented in the company. Equal representation of both genders has also been key in the company through a plan that it launched centuries ago known as the diversity strategy. Career development workshops mainly focusing on women, and diversity training has always been offered ever since the introduction of the strategy. According to Pride, Hughes, and Kapoor, â€Å"McDonald’s encourages the hiring and training of employees with diverse ethnic backgrounds. Hiring a diverse mix of employees helps