http://www.loc.gov/mods/v3 http://www.loc.gov/standards/mods/v3/mods-3-2.xsd
choice of invoice currency in international trade
Anjali Agarwal, a young MBA and first-generation entrepreneur, established her own sole proprietorship firm M/S Agarwal Exports in August 2019. Located in Chandigarh city, India, the firm was engaged in production and sale of rice. In the first two years of operation, the company sold its product only in the domestic market. After two years, Anjali decided to expand her business to export markets, at first confining this effort to the developed markets of the United States, Canada, and Australia. However, Anjali was confronted with the issue of the choice of optimal invoice currency for pricing her exports and the determining factors for the choice. After attending a seminar, Anjali learned that there is no single solution. Thus, she has to weigh various factors to decide on the optimal invoice currency for her business. This case allows for a discussion of currency risk of exports business aside from other risks and the risk mitigation tools. The primary focus of the case is on the choice of invoice currency as a means of managing currency risk and the determinants for the optimal choice of invoice currency. In this case, students will be asked to determine, incorporating relevant factors into their analysis, the optimal choice of invoice currency for an exporter.