Unit 8 Power Point: International Finance

The United Kingdom is one of the leading nations regarding development. Apple Company is going to enjoy success in the region. The decision by the firm to move in the geographical area is the best to increase market share. Moving to a new area, there are various challenges that face an organization that needs to be dealt with to make the organization achieve its objectives. Apple Company needs to utilize multiple strategies to succeed in the market. One of the ways is the protection of the company information as one of the priority. The firm has set various measures to ensure the data generated is secure and confidential.

One of the methods used is the adoption of biometric. Biometric is used to secure companies operations and improve the level of confidentiality in the entire organization. By doing so, the company ensures there is no copyright of products. The deficit is the annual amount the government borrows to meet the shortfall in the tax and the total amount spent by the government. In the year 2016/2017 United Kingdom had a balanced deficit of £45 billion which is equivalent to 2.3 % percent. In other times the nation has managed to run a surplus budget. The first time the UK government had a surplus budget is 2001 which was approximate £17 billion. The deficit in the UK budget is associated with the following term. The current budget, cyclical budget deficit, public sector net cash among others (Pettinger, 2017). The following factors cause potential corruption and crises. They include political stability, law, government matters, and interdisciplinary approach. In 2008, the nation was faced by global financial crises which hit hard on the economy. The crises caused the following that is high customer debts, economic slowdown, falling off the home prices among others.

Currency structure

The United Kingdom has a different currency to the United States. The same goes for valuation and it is something that affects the organization. Apple Company has to consider UK currency valuation to that of the United States. The national currency is pound sterling. British money is the one currently dominating the world. The currency structure in the United Kingdom favor Apple Company operations. However, the British currency is superior to that of other countries.

Institutional factors

The UK is one of the leading trading power which is enabled by financial centers in the world. Its economy depends mainly on industrialization and agricultural product. It is currently among the fifth largest economy in the world. The size of its economy is based on its high value of GDP which is a total of $3.04 trillion (Khan, 2015). Central Banks mainly governs domestic investors base. The shift of the investors’ support from government to domestic holders has boosted the economy of the nation. This is because investors realize an opportunity in the market and take it.

Flexibility of Exchange rates

The flexibility of the exchange rate regime is an exchange rate where the forces of supply and demand of foreign exchange determine the rate of exchange in international markets (Evrensel, u.d.). Apple Company will thrive best if a flexible exchange rate system is maintained in the UK since it will aid in optimum resource allocations. Also, a flexible exchange will ensure that the UK government will not hold any foreign exchange reserves. The sterling pound currency will, hence, be allowed to adjust freely in the foreign market.

References