The hospitality industry is increasingly globalized, with many organizations operating in multiple countries. In this project, you will explore the various financial risks associated with foreign exchange, including transaction, translation, and economic exposure

I.$$ Choose two of the following case studies and answer the corresponding questions for each:

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Case $1$: Exposure to Foreign Exchange Risks

Case A: A Spanish hotel chain with properties in the United States and the United Kingdom.

Case B: An Australian cruise line with operations in the Caribbean and Europe.

Questions:

$$ Explain the nature of foreign exchange exposure for Case A$.$

$$ Explain the nature of foreign exchange exposure for Case B$.$

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Case $2$: Foreign Exchange Exposure

Case A: A global hotel booking platform based in Singapore.

Case B: A luxury resort chain with properties in the Maldives, Mauritius, and Fiji.

Questions:

$$ Identify the primary foreign exchange exposures for Case A$.$

$$ Describe the potential impact of foreign exchange rate fluctuations on Case B$\text{'}$s financial performance.

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Case $3$: Transaction Exposure

Case A: A Canadian ski resort attracting primarily American tourists.

Case B: A French restaurant chain with several locations in the United States.

Questions:

$$ Analyze the transaction exposure faced by Case A due to fluctuations in the USD$/$CAD exchange rate.

$$ Evaluate the potential impact of a strengthening Euro on Case B$\text{'}$s profitability.

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Case $4$: Translation Exposure

Case A: A US$-$based hotel management company with properties in Mexico and Brazil.

Case B: A British luxury hotel group with operations in China and India.

Questions:

$$ Explain the translation exposure faced by Case A due to fluctuations in the Mexican Peso and Brazilian Real.

$$ Assess the potential impact of a weakening Pound Sterling on the financial statements of Case B$.$

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Case $5$: Economic Exposure

Case A: A Caribbean all$-$inclusive resort heavily reliant on tourism from the United States.

Case B: A European spa and wellness retreat targeting high$-$end clientele from Russia and Ukraine.

Questions:

$$ Analyze the economic exposure faced by Case A due to potential economic downturns in the United States.

$$ Evaluate the impact of geopolitical instability on Case B$\text{'}$s business operations.

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II$.$ Based on your analysis of the case studies, provide recommendations for hospitality management on:

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o$$ Identifying and assessing foreign exchange risks.

o$$ Developing strategies to mitigate foreign exchange exposure.

o$$ Incorporating foreign exchange risk management into overall business planning.

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$*$Consider the impact of factors such as hedging, currency diversification, and economic conditions on foreign exchange risk management.