Business

Chapt 2 -What is the difference between book value per share of common stock and market value per share? Why does this disparity occur? -What is the difference between accumulated depreciation and depreciation expense? How are they related? -Comment on why inflation may restrict the usefulness of the balance sheet as normally presented -what are […]

Why Do Firms become Multinational? Why Do Firms become Multinational? Strategic motives drive the decision to invest abroad and become an MNE. These motives can be summarized under the following categories: 1. Market seekers produce in foreign markets either to satisfy local demand or to export to markets other than their home market. U.S. automobile

Corporate Responsibility and Corporate Sustainability Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs. —Brundtland Report, 1987, p. 54. What is the purpose of the corporation? It is increasingly accepted that the purpose of the corporation is to certainly create profits

Concept International Domestic Culture, history and institutions Each foreign country is unique and not always understood by MNE management Each country has a known base case Corporate governance Foreign countries’ regulations and institutional practices are all uniquely different Regulations and institutions are well known Foreign exchange risk MNEs face foreign exchange risks due to their

What Is Different About International Financial Management? What Is Different About International Financial Management? Exhibit 1.4 details some of the main differences between international and domestic financial management. These component differences include institutions, foreign exchange and political risks, and the modifications required of financial theory and financial instruments. International financial management requires an understanding of

Global Outsourcing of Comparative Advantage 11Current Multinational Challenges and the Global Economy CHAPTER 1 importing these services compared to their own other industries. Remember that it takes a relative advantage in costs, not just an absolute advantage, to create comparative advantage. For example, India has developed a highly efficient and low-cost software industry. This industry

Global Capital Markets 5Current Multinational Challenges and the Global Economy CHAPTER 1 additional securities have been created from the existing securities—derivatives, whose value is based on market value changes in the underlying securities. The health and security of the global financial system relies on the quality of these assets. Institutions. The institutions of global finance

Global Capital Markets: Entering a New Era The current financial crisis and worldwide recession have abruptly halted a nearly three-decade-long expansion of global capital markets. From 1980 through 2007, the world’s financial assets—including equities, private and public debt, and bank deposits—nearly quadrupled in size relative to global GDP. Global capital flows similarly surged. This growth

Financial Globalization and Risk Back in the halcyon pre-crisis days of the late 20th and early 21st centuries, it was taken as self evident that financial globalisation was a good thing. But the subprime crisis and eurozone dramas are shaking that belief. Never mind the fact that imbalances amid globalisation can stoke up bubbles; what

Current Multinational Challenges and the Global Economy I define globalization as producing where it is most cost-effective, selling where it is most profitable, and sourcing capital where it is cheapest, without worrying about national boundaries. —Narayana Murthy, President and CEO, Infosys. The subject of this book is the financial management of multinational enterprises (MNEs). MNEs