Ben Holt, Blades’ CFO, is particularly concerned about the level of inflation in Thailand. Blades’ export arrangement with Entertainment Products, while allowing for a minimum level of revenue to be generated in Thailand in a given year, prevents Blades from adjusting prices according to the level of inflation in Thailand. In retrospect, Holt is wondering whether Blades should have entered into the export arrangement at all. Because Thailand’s economy was growing very fast when Blades agreed to the arrangement, strong consumer spending there resulted in a high level of inflation and high interest rates. Naturally, Blades would have preferred an agreement whereby the price per pair of Speedos would be adjusted for the Thai level of inflation. However, to take advantage of the growth opportunities in Thailand, Blades accepted the arrangement when Entertainment Products insisted on a fixed price level. Currently, however, the baht is freely floating, and Holt is wondering how a relatively high level of Thai inflation may affect the baht-dollar exchange rate and, consequently, Blades’ revenue generated in Thailand.