Nukee, a United States shoe manufacturer and retailer, established two retail outlets in the city of...

Nukee, a United States shoe manufacturer and retailer, established two retail outlets in the city
of Shenzen, China, which has a population of 3.7 million. These outlets are massive and contain
products purchased locally as well as imports. As Nukee generates earnings beyond what it
needs in Shenzen, it may remit those earnings back to the United States. Nukee is likely to
build additional outlets in Shenzen or in other Chinese cities in the future.

Explain how Nukee might utilize the international money market when it is establishing
other Nukee stores in Asia?

Solutions

Expert Solution

Nukee can use International money market in following ways-

A. International money market can help the company financing various trades because it will be helping to generate finance through bills of exchange.

B. international money market will be providing the company with the short term funds and it will help in financing their capital requirement for working capital and it will help in discounting bills through commercial banks and discount houses and brokers and acceptance houses.

C. International money market will be helping the company in order to have access of financial mobility as it will be easier for the company to transfer various funds from different sector to sector and place to place.

D. International money market will also be offering liquidity and safety while dealing with the transaction because it will be promoting high level of liquidity and safety and it will be encouraging savings and investment for the company.

E. International money market will be helpful in reduction of the use of the cash because money market will be mostly dealing with the assets which have high liquidity so the company will be reducing the use of the cash money and it will also be safer to move from one place to another place.

F. It will help the company in order to implement the monetary policy of the country in a better manner because the company can synchronise this policy with the monetary policy through having access to the international money market.

jeff jeffy answered 1 year ago

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