Why do foreign national move into lower exchange markets? What would happen if they expanded into… 1 answer below »

Why do foreign national move into lower exchange markets? What would happen if they expanded into Indonesia, could be volatile? How companies protect themselves against forgiven exchange changes in poor countries is what companies do. (Journal) Why are exchange rates low? Why companies go overseas to grow…

The direct exchange rate for USD is currently about $1.40, if they gain competitiveness then they should be able to export (school notes) more which is a good thing for Netflix, because it will be able to set up a new business for a lower cost. However, if the US dollar weakens this will cause inflation, a weaker dollar helps US exports as the prices of goods will be cheaper which attracts investors. If the US dollar was to fall against the new country currency, then Netflix could mitigate this hedging the new currency, by either buying the currency now or taking on a futures contract to convert their US dollars at a predetermined exchange rate in the future. The best hedge against risk is with a well-diversified investment portfolio https://www.thebalance.com/dollar-decline-or-dollar-collapse-3306090).

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