Question
Currencies and Political Risk: The British vote in June 2016 to exit the European Union was largely based on social and political issues. i .
Currencies and Political Risk:
The British vote in June 2016 to exit the European Union was largely based on social and political issues.
i. Read the following article on Bloomberg.com on the Brexit vote.
https://www.bloomberg.com/quicktake/will-uk-leave-eu
According to the article, how is the Brexit vote related to Multinational Finance? Specifically focus on international trade and trade agreements, MNE's investments abroad.
ii. Visit https://finance.yahoo.com/currencies. Click on 'GBPUSD=X'. this is the exchange rate for the price of 1 British Pound Sterling in U.S. dollar terms. On the following page click on 'Full Screen' for a larger graph. You can further adjust your graph, click on 'interval' above to choose a 1-day interval.
Following the Brexit vote, describe what happened to the exchange rate between the two currencies? How the currency change may affect a U.S. based firm, exporting its product to the UK?
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