Business

Do its lenders face any currency risks? Huaneng Power International is a large Chinese company that runs coal-fired power plants in five provinces and in Shanghai. It has close to $1.2 billion in U.S. dollar debt whose proceeds it has used to purchase equipment abroad. a. What currency risks does Huaneng face? b. Do its […]

What currency risks does Huaneng face? Huaneng Power International is a large Chinese company that runs coal-fired power plants in five provinces and in Shanghai. It has close to $1.2 billion in U.S. dollar debt whose proceeds it has used to purchase equipment abroad. a. What currency risks does Huaneng face? b. Do its lenders

Suppose the company is a multinational firm with sales in Japan and inputs that are determined primarily in dollars. How should this affect its financing choice? A U.S. company needs to borrow $100 million for a period of seven years. It can issue dollar debt at 7% or yen debt at 3%. a. Suppose the

Suppose the company is a multinational firm with sales in the United States and inputs purchased in Japan. How should this affect its financing choice? Di Giorgio International, a subsidiary of California-based Di Giorgio Corporation, processes fruit juices and packages condiments in Turnhout, Belgium. It buys Brazilian orange concentrate in dollars, British apples in pounds,

What was the likely impact of the strong Singapore dollar on U.S. electronics manufacturers using Singapore as an export platform? In 1994, the Singapore dollar rose by 9% in real terms against the U.S. dollar. What was the likely impact of the strong Singapore dollar on U.S. electronics manufacturers using Singapore as an export platform?

Assuming all else is equal, which of these companies—Chrysler or Compaq—is likely to benefit more from a weak dollar? Chrysler exports vans from the United States to Europe in competition with the Japanese. Similarly, Compaq exports computers to Europe. However, all of Compaq’s biggest competitors are American companies—IBM, Hewlett-Packard, and Tandem. Assuming all else is

What marketing and production techniques can firms initiate to cope with exchange risk? 4. What is the role of finance in protecting against exchange risk? 5. E & J Gallo is the largest vintner in the United States. It gets its grapes in California (some of which it grows itself) and sells its wines throughout

What marketing and production techniques can firms initiate to cope with exchange risk? 4. What is the role of finance in protecting against exchange risk? 5. E & J Gallo is the largest vintner in the United States. It gets its grapes in California (some of which it grows itself) and sells its wines throughout

What marketing and production techniques can firms initiate to cope with exchange risk? 4. What is the role of finance in protecting against exchange risk? 5. E & J Gallo is the largest vintner in the United States. It gets its grapes in California (some of which it grows itself) and sells its wines throughout

The sharp decline of the U.S. dollar between 1985 and 1995 significantly improved the profitability of U.S. firms both at home and abroad. a. In what sense was this profit improvement false prosperity? b. How would you incorporate the decline in the dollar in evaluating management performance? In making investment decisions? c. Comment on the