Fundamentals of corporate currency exposure
AbstractI model the relation between corporate currency exposure and fundamental variables like demand elasticities and operating cost structure. The currency location of a firm's operating costs may be in the home currency, the foreign currency, or partially in each. I start with a single-firm setting and extend the results to a competitive setting. The model should help managers better understand the determinants of currency exposure and thus better perform the important tasks of strategic planning and managing enterprise risk.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of International Financial Markets, Institutions and Money.
Volume (Year): 20 (2010)
Issue (Month): 3 (July)
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Web page: http://www.elsevier.com/locate/intfin
Currency exposure Demand elasticity Operating costs Competition Exchange rate;
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Working Papers, C.V. Starr Center for Applied Economics, New York University
95-14, C.V. Starr Center for Applied Economics, New York University.
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- Marston, Richard C., 2001. "The effects of industry structure on economic exposure," Journal of International Money and Finance, Elsevier, Elsevier, vol. 20(2), pages 149-164, April.
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