From a company-owned plant in Pakistan,Howard manufactures specialty apparel items for his small business,Garments of Eden.Because of overseas operations of the U.S.military in the region,Howard fears that his plant may be sabotaged or that the local government may attempt to take over the facility.Specifically,his fears are about

Question

Quizplus · Accepted Answer

Howard's fears revolve around the potential impact of political instability or government intervention in the region. This is an example of political risk, which refers to the potential for political events or actions to negatively impact a company's operations, profitability, or assets. Economic risk refers more broadly to the potential impact of broader economic conditions on a company's performance, while exchange rate risk specifically relates to the impact of foreign currency fluctuations on a company's finances. While these risks may also be present in this scenario, they are not the primary concerns identified by Howard.

From a Company-Owned Plant in Pakistan,Howard Manufactures Specialty Apparel Items