Business Studies – 6.2.4 Exchange rates | e-Consult
6.2.4 Exchange rates (1 questions)
Login to see all questions.
Click on a question to view the answer
When the Euro appreciates against the Pound, it means the Euro is stronger. This has the following effects:
- Cost to German Customers: The cost of the UK company's goods to German customers will decrease. Because the Euro is stronger, German customers can buy more goods for the same amount of Euros.
- Competitiveness: The UK company becomes more competitive in the German market. Lower prices make the goods more attractive to German consumers, potentially increasing sales volume. This can lead to higher market share and increased revenue for the company. However, the company may also face increased competition from German companies whose goods are now relatively more expensive in the UK market.