International Business Dell Mercosur: Getting Real in Brazil

International Business Name: Course: Professor Name: (November 5, 2011) Steps of an exposure management strategy Some of the steps of an exposure management strategy are denominating the revenues and operating costs of the business in the country`s currency. Revenues and operating costs of Dell are denominated in brazilian reals. The manufacturing costs of Dell are denominated in US dollars where most of the manufacturing takes place. Management of exposure to foreign currency exchange rate is done by reducing fluctuations of earnings and cash flows which is associated with foreign currency exchange rate changes (Meredith, 1998). Describe and evaluate Dell`s exposure management strategy Dell`s strategy of exposure management strategy is achieved by reducing the impact of fluctuations on earnings and cash flows associated with foreign currency exchange rates. Dell also uses foreign currency option contracts and forward contracts which are aimed at hedging its exposure on forecasted...