. A higher level of inflation in Thailand would most likely affect Blades in a positive

manner. Generally, if a country’s inflation increases it drives the consumers and

corporations of that country to buy more goods overseas, thus Blades’ sales should

2. Anticipated inflation favors Blades. If the inflation in Thailand increases both, the U.S.

and Thailand firms would be forced to raise their prices in order to maintain the profit

margin. Since Blades’ cost of goods sold in Thailand is relatively small, it should not be

affected as much by the inflation. This means that Blades should not have to raise prices

as much as the competitors, putting Blades in a favorable position.

3. Decreasing level of national income in Thailand would negatively impact Blades. Local

consumers will have less money to spend. In addition, because Blades’ product is not

a necessity but a leisure-product, the demand for it will drastically decrease. There is

also a chance that the importer may terminate the future arrangements due to the poor

4. Continued depreciation in baht would negatively impact Blades because Blades invoices

its product in this currency. Baht denominated revenue will consequently be converted

in fewer U.S. dollars. However, the demand for Blades products might be positive in

comparison to the U.S. competitors in Thailand. The U.S. competitors that export their

roller-blades to Thailand invoice their products in the U.S. dollars. In order to pay for the

dollar denominated products the importers will have to convert more baht to dollars, thus

making demand for Blades’ products increase in comparison to the U.S. competitors.

Blades,