Essays on Exchanging Rate Holds as an Important Part of Business Working Assignment

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The paper "Exchanging Rate Holds as an Important Part of Business Working " is a perfect example of a business assignment. The exchange rate of the Malaysia Ringgit has seen fluctuations as compared to the Dollars which shows that the market demand and supply have determined the price. It has been identified that at peak times especially during times where there is a festival in Malaysia the currency Ringgit gains against dollars whereas the other time it seems to lose. The fluctuations have some concerns for AirAsia as the changes in the value of the currency has an effect on the number of travelers booking tickets over their airlines.

Since AirAsia is a low-cost airline and people look towards ensuring that the price charged by the airline is low and with the growth in low-cost airlines it is imperative that the prices are low. This is instead of having an effect on the performance as it has made the airlines lose customers and the fluctuations in the price have made it difficult to determine the exact price. Despite it, the fluctuations are not very high which thereby has limited the impact on the airlines and requires that the airlines look to deal with the issue as it will ensure that the outside customers are able to get the tickets at a lower price as the dollar is expensive in comparison to Ringgit which will thereby ensure that the price charged by them remains lower especially for tourist who have their currency in dollars.

This will thereby ensure that the company will be able to use the opportunity for improving its business in the future. Thus, the fluctuations in the exchange rate had an effect on the business outcome of Malaysia. 2.

The law of price states that each and every player supplying similar products has to look towards selling the products at the same price. This will increase the complexities for AirAsia as it will become difficult for the airlines to distinguish themselves based on price. The fact that other airlines will look towards charging the same price will make service a priority based on which the services will be differentiated.

References

Colell, M., Winston, A., Michael, D. & Jerry, R. 1995. Microeconomic Theory. 3r Edition, New York, Oxford University Press, Pearson Education

Dohring, B. 2008. Hedging and invoicing strategies: to reduce exchange rate exposure: a euro area perspective. Economic & Financial Affairs, European Papers

Ernest, A. 2009. The impact of financial crisis on developing countries: Ghana. Social and Economic Research of the University of Ghana

Garg, S. 2010. Microeconomics: Introductory. 7th edition, pp 3.11-9.17, Dhanpat Rai Publication

Kotler, P. 2002. Marketing Management. 11th edition, page 147-149, Prentice Hall, India

Mankiw, Y. 2008. The influence of monetary and fiscal policy on aggregated demand. Short Run economic function. The Times Magazine

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