Fluctuating exchange rates can alter a multinational firm's profits and losses.The U.S.corporation,Motorola,produces cell phones and sells cell phones in Mexico.If the dollar depreciates against the peso,then Motorola's revenues from these operations should ________ and its costs from these operations should ________.

Question

Quizplus · Accepted Answer

When the dollar depreciates against the peso, Motorola's revenues in pesos will convert to more dollars, increasing revenues. However, costs in pesos will also convert to more dollars, increasing costs.

Fluctuating Exchange Rates Can Alter a Multinational Firm's Profits and Losses.The