Apple PLC, the globally-dominant California-based US-Tech giant is worried that despite its big

market share across all market segments, changes in the global economy and the geo-political

6

environment is negatively affecting its profitability. Depreciating currencies from its major

markets and the volatile global political environment has resulted in falling profitability despite

an increased market-share, increased revenues and falling operational costs.

2006 2010 2012 2014 2016 2017

Market Share 25% 30% 35% 40% 45% 55%

Revenues $500 bn $750 bn $1.000 tn $1.500 tn $2.000 tn $2.500 tn

Operational Costs $200 bn $250 bn $225 bn $200 bn $175 bn $150 bn

Net Income

+ Extraordinary

items

$350 bn $650 bn $825 bn $1.400 tn $1.900 tn $2.350

Q) Apple PLC has hired you to briefly explain the four specific risks to a global firm from foreign

exchange exposure?