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Originally Posted by Jason[98.EL]
how does the dollar work in this case
we export in US dollars and everyone at work states that the lower the au is against the us dollar the better
Jason
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Thats right.
Say the person buying the product pays (for example) $100USD/unit. No matter what its AUD cost of the unit, the buyer will pay the same price.
Say it costs $80AUD to manufacture and ship the product.
At parity $1AUD=$1USD, then the profit is $20AUD per unit.
At $1AUD=$0.80USD, then the profit is now $45AUD per unit.
So basically the less the Australian Dollar is worth overseas, the more profitable it is to export, and the more expensive it is to import.