INTERNATIONAL FINANCIAL MARKETS Assignment Example | Topics and Well Written Essays - 250 words

INTERNATIONAL FINANCIAL MARKETS - Assignment Example These incentives provide new revenue opportunities for Acme in the United States. Countries in the EU that can provide these incentives are backed by the strong power of the euro currency and it also creates a linkage between other European countries that are already developed with a quality infrastructure for manufacturing and distribution. Being able to rely on these networks and existing business expertise makes JEL Industries a much better option than trying to work from the ground-up at DBC Industries outside of the EU. The strong euro has also provided developing countries in the European Union with knowledge of metallurgy, motor vehicles, glass production and heavy machinery production (Weidenbaum). Therefore, if Acme desires ample raw materials or the ability to select from a skilled labor pool of talented individuals, the EU is the most vital option for long-term growth and security for the business. Further, the value of the U.S. dollar is currently falling compared to the euro, therefore there are some cost advantages to selecting JEL Industries over DBC Industries. When consumers or industrial buyers make purchases of Acme products, they are using currency that will provide a higher profit. Why is this? The business can establish a higher pricing policy on its products to offset the costs of operations and/or distribution, and when the exchange between the EU and the U.S. dollar occurs, there will be more profit than if the products were sold domestically. Because the EU value is relatively stable, there is not the concern of sudden economic collapse that might occur with a more self-contained currency outside of the European Union. Thus, for profit purposes, JEL Industries is the recommended choice. Because more communications occur between EU partners, there will be less long-term costs associated with