Research Method Essay Example | Topics and Well Written Essays - 2250 words

Research Method - Essay Example 6. When a financial organization decides to take part in financing activities, there are a number of risks that the move. The risks include political risks and foreign exchange risk. The risks make it difficult for the institution to maintain reliable and constant revenue. 7. Paying the amount in three months’ time may be reached at if the paying company is capable of availing the amount in three months’ time. Financial ability is the main contributes much to the financing action. The bank would prefer the payment to be made in twelve months since the longer the bank transacts the payment, the higher the bank interest earned (Pratt, 2011). 8. Once the USASuperCars accepts the HSBC’s offer, the risk will lie on the financial institution too. The bank, on the other hand, may gain or lose depending on the exchange rates. The probability of the bank making a loss are minimal because HSBC native currency is in sterling pounds which are stronger that the dollars. 9. The fixed sum of money is about $2,150,000 without exchange rate risk while HSBC has 29% chance to lose and 5% chance to gain more than $200,000. Analyzing the information keenly, the exchange rate is risky to HSBC. The bank is either going to generate a profit of five percent of the loss of about twenty-nine percent. Â  I am writing this report to make financial decisions for Corvette Company, which sells luxury sports cars to various countries in the world. The company is situated in the United States and deals with a unique brand of cars. The good reputation of the company has seen it move far ahead of other car selling companies. The success of the company is due to coordination between different departments. The managing board makes decisions that have seen Corvette retain it unbeaten reputation in the entire globe. Good quality and affordable produce are indeed the pushing force behind its success (Guffey & Loewy, 2013). I will analyze the financial risks,