Research Methods Essay Example | Topics and Well Written Essays - 3000 words - 1

Research Methods - Essay Example The uncertainty of a given amount of revenue that may be gotten, after the perspective order in various currencies are converted to $ are computed. This provides estimation of the anticipated future revenue, to help the company in budgeting and planning processes. Consequently, the HSBC offer will be discussed to explore the disadvantages and advantages of handling the decision from the CEO and Sales manager point of view. Consequently, the paper discusses the Value at Risk of the bank, alternative options, and the historical performance of exchange rates. The conclusions from the paper will be helpful in directors and managers of USASuperCars to make proper decision in reference to the perspective future revenues, and proper ways to deal with the fluctuation in exchange rates. Introduction USASuperCars is a company that sells luxury sport cars. The company has signed a contract with seven clients around the globe to sell cars in a year’s time. The selling prices are always co nstant and are in domestic currency at the prevailing market’s selling price at the delivery time (Sarno & Taylor, 2002). One of the problems that the company faces is the uncertainty of the exchange rates, to cope with the uncertainty. The company has come up with standard deviation and estimates from the Bank of America to curb the uncertainty. The accompanying report concluded that the rates are independent and evenly distributed. Question 1 Table 1: The Total Revenue in Dollars Worldwide Orders       Exchange Rate          Customer Quantity SP SP ($) Revenue ($) Mean SD Mean ($) SD ($)    UK 12 ?57000 91006.2 1092074.4 $ 1.41/? $0.041/? 80370 2337    Japan 1 5 Y 8500000 85442 427210 $0.00904/Y $0.00045/Y 76840 3825    Japan 2 3 Y9000000 90468 271404 $0.00904/Y $0.00045/Y 81360 4050    Canada 1 1 CAD 97000 92447.86 92447.86 $0.824/CAD $0.0342/CAD 79928 3317.4    Canada 2 3 CAD 100000 95338 286014 $0.824/CAD $0.0342/CAD 82400 3420    South Africa 2 R4 100000 9654.65 19309.3 $0.0211/R $0.000083/R 2110 8.3    USA 1 $100,000 100000 100000                Total Revenue       564356.71 2288459.56       403008 16957.7    The table shows the revenue conversion from foreign countries converted into domestic currency. In the table above, it shows that the mean revenue is 2,288,459.56 dollars. Using the figure, the standard deviation is calculated as 338350.8071. The estimated probabilities for different situations are stated below Question 2 2 (a) Worldwide Orders             Exchange Rate       Customer Quantity SP SP ($) Revenue ($) Mean-Revenue Squared Mean SD Mean ($) SD ($) UK 12 ?57000 91006.2 1092074.4 765151.6057 5.85457E+11 $ 1.41/? $0.041/? 80370 2337 Japan 1 5 Y 8500000 85442 427210 100287.2057 10057523630 $0.00904/Y $0.00045/Y 76840 3825 Japan 2 3 Y9000000 90468 271404 -55518.79429 3082336519 $0.00904/Y $0.00045/Y 81360 4050 Canada 1 1 CAD 97000 92447.86 92447.86 -234474.9343 54978494808 $0.824 /CAD $0.0342/CAD 79928 3317.4 Canada 2 3 CAD 100000 95338 286014 -40908.79429 1673529450 $0.824/CAD $0.0342/CAD 82400 3420 South Africa 2 R4 100000 9654.65 19309.3 -307613.4943 94626061867 $0.0211/R $0.000083/R 2110 8.3 USA 1 $100,000 100000 100000 -226922.7943 51493954566             Total Revenue       564356.71 2288459.56             403008 16957.7 Mean          326922.7943                   Variance                1.14481E+11             SD