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Firms differ in the extent to which they "pass-through" changes in exchange rates into the prices they charge in foreign markets. They also differ in their "exposure" to exchange rates--the responsiveness of their profits to changes in exchange rates. Because pricing directly affects...
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Firms differ in the extent to which they "pass through" changes in exchange rates into foreign currency prices and in their "exposure" to exchange rates-the responsiveness of their profits to changes in exchange rates. Because pricing affects profitability, a firm's pass-through and exposure...
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