Question

Assume that you are a US-based MNC. Please tell me how you would assess and reduce the economic exposure for a company that the US MNC owns in Spain

Answer 1

Answer:

Assuming that we are a US-based MNC and we would assess and reduce the economic exposure for a company that we as a US MNC owns in Spain will be as below

• We will focus on the currency exchange risk, so that we can lower and assess the economic exposure for the firm based in Spain.
• We will manage the operational risk mitigation, as operational risk mitigation will also helps in lowering and assessing the economic exposure for the Spain based US MNC.
• The US based MNC will be focusing on the economic exposure of the Spain based company such that it will track all the economic transactions so that it can assess, reduce and manage the economic exposure of their sister company in Spain.
• US parent company in US will have better mean and approaches for managing the currency controls so they can apply these learning for the currency control and manage at their Spain based sister company. This will help in assessing and managing the economic exposure for the Spain based company.
• The US based parent MNC company will deploy all the key processes and approaches at their Spain based sister company, so that will help in economic exposure for the Spain based company.