The Hohner Marine Band harmonica retailed for €30 in Germany (see Exhibit 2). German retailers generally insisted on a 33% margin, and distributors took a 12% margin, based on the selling price of each. Hohner and its direct competitors sold a total of 800,000 units annually, with Hohner’s share at 75%. Hohner faced variable manufacturing costs of €2.70 per Marine Band, with fixed manufacturing costs of €900,000 and an annual advertising budget of €500,000. The Marine Band manager’s salary and expenses totaled €35,000. Marine Band salespeople working for Hohner were paid solely by a 10% commission on Hohner’s sales. Shipping costs, breakage, and insurance were €0.60 per unit. What is the unit contribution for Hohner?

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Exchange Rate Risk

It is the possibility that the value of a currency will fluctuate in the future. In the wake of globalization, business establishments have increasingly ventured into international markets. The volume of international trade has prospered excellently in the near past and is expected to be more affluent in the future. The use of exchange-traded derivative financial instruments has been multi-folded to provide for the requirements of various MNCs and offshore potential investors. Most banks and financial institutions have helped integrate the global economies. Our Government has introduced some bold and extreme measures to fulfil the purpose behind the fiscal, industrial, and monetary policies. The enactment of GST is a huge step towards streamlining the taxation system of the country. Owing to Covid-19, this aspect of corporate risk management has become critical.