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A risk, in this case, can be said to be any occurrence that can possibly hinder Nodalfrom achieving its financial objectives. For instance, fluctuations in currency exchange risks can result in failure by the organization to achieve said objectives. Nodal is facing risks that are related to the currency used in the Brazilian market. Exchange rate fluctuations are a form of economic exposure. As noted earlier, in the Brazilian commercial real estate contractsmay only be done using the real and Nodal uses dollars in all of its other transactions. The dollar is one of the world’s strongest currencies. Also, dollar is often stable and in recent years, the real has been increasingly stable as well. Adding to that is the fact that Brazil has also becoming additionally resilient to changes in the political environment. However, things could take a negative spin and the Brazilian currency could depreciate against the dollar. Should the Brazilian currency depreciate against the dollar then it would mean that organization mightsuffer losses a factor that may hinder it from achieving its organizational objectives. For instance, when such automatic changes in the economy as recession occurs the government is compelled to lower taxes imposed on the consumers. The main objective of lowering the taxes is to increase the amount of disposable income available to the consumers so as to increase their purchasing power and hence increase the aggregate demand, which can possibly help the economy to recover from recession. Should this occur in the Brazilian market, it would mean that the Brazilian currency will depreciate against the dollar and hence the organization will be the risk of failing to hit its financial objectives in terms of the targeted profitability.  

Along with the exchange rate risk, Nodal will also have to deal with the remittance process, which as explained earlier is not an easy task. All foreign investors have to register with the Central Bank of Brazil to be able to remit funds back to their home country.   

It is worth noting that the government is responsible for the economic growth of the country and hence it is obligated to make discretionary decisions to manipulate the economy in an attempt to ascertain economic growth. For instance, a government may undertake discretionary contractionary fiscal and monetary policies as a course of action to manipulate the economy. According to Mankiw (2014), discretionary contractionary fiscal and monetary policies reduce the amount of disposable income available to the consumers so as to reduce their purchasing power and hence control the inflationary effect that is being experienced in the country. Though this may work for the economy of the country, it can adversely affect Nodal Corporation should the Brazilian government affect it. Reducing the purchasing power of the consumers will mean that the consumers ’ability to afford industrial buildings will be reduced and hence this will affect the market share available to the Nodal.  

Another currency risk the Brazilian project poses is operating risk due to the fixed assets they will own. Real estate is not a liquid asset. In the event that the company needs to get sell their Brazilian property, it could take months or even years to convert to cash. This subjects Nodal to a major operational risk. The rent earned from this property had to be converted to dollars that meant the firm would face foreign exchange risk here as well. 

The primary management methods to be considered are as follow: 

-The company could choose to do nothing and face the possibility of all risks involved. 

-They could also choose to use forward contracts. 

-Another option is to use currency put options. 

-They could also use currency adjustment clause to have their clients share in the currency risk on both positive and negative changes of the exchange rate. 

-Finally, Nodal could use currency swap.