Assignment:

You are an Executive at the Canadian-based company Panamera Inc., a software company

that sells and provides its services online (SaaS model). Your company's core product,

initially developed by a Management Sciences professor, was in commercial use for over a

decade before you joined the company. Panamera's software provides a full suite of tools to

help customers organize their operations, staff, and clients, as well as manage their financials

and communications.

You and your team have turned your company into a viable going concern. Sales in Canada

have quadrupled in the past quarter, and there is significant interest in your SaaS from all

over the World. After a lot of hard work, Panamera is most likely entering a hyper growth

situation. Panamera is expecting to process 100's of millions of dollars (CAD) in transactions

annually within three years.

One of the challenges Panamera faces is managing significant new sales from abroad. Your

merchant account provider (merchant account provider's processes credit card transactions)

has suggested that you open a foreign-based subsidiary to process sales outside of Canada.

If Panamera opens a subsidiary in one of your assigned jurisdictions and processes

transactions through that subsidiary location, your merchant account rate will drop by about

1% to an effective rate of 1.75%, regardless of where sales are generated.

Locations are assigned as follows:

Douglas, Isle of Man; Belize City, Belize; Hong Kong (PRoC)

Q- / explain and clarify the foreign exchange based on the above new locations.