4.14 Idris Hydraulics and the Thai Baht. Idris Hydrau- lics of Kuala Lumpur, Malaysia, purchases all...
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4.14 Idris Hydraulics and the Thai Baht. Idris Hydrau- lics of Kuala Lumpur, Malaysia, purchases all of its hydraulic drills from manufacturers in Thailand. The company has recently completed a corporatewide initiative in six sigma/lean manufacturing. Completed oil field hydraulic system costs were reduced 5% over a one-year period from RM900,000 to RM855,000. The company is now worried that all of the hydraulic drills that goes into the systems (making up 30% of their total costs) will be hit by an increasingly stron- ger Thai baht due to the robust Thai economy. If the current exchange rate is THB7.18/MYR, how would a 14% revaluation of the Thai baht against the Malay- sian ringgit impact total systems costs?
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Related Book For
Multinational Business Finance
ISBN: 9781292270081
15th Global Edition
Authors: David Eiteman, Arthur Stonehill, Michael Moffett
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