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explain and compare forward vs backward internalizationforward internalization takes place when mncs with intangible assets make fdi in order to use
how would you incorporate political risk into the capital budgeting process of foreign investment projectsone method is to adjust the cost of capital
why do you think the host country tends to resist cross-border acquisitions rather as compared to green field investmentsanswer the host country is
explain vernonrsquos product life-cycle theory of fdi what are the strength and weakness of the theoryanswer as to the product life-cycle theory
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how would you describe the fact that china emerged as the second most significant recipient of fdi after the united states in recent yearsanswer
currently many foreign firms from both developed and developing countries obtained high-tech us firms what might have motivated these firms to obtain
it is usually not possible to totally eliminate both translation exposure and transaction exposure in few cases the elimination of one exposure
explain the re-measurement and translation process within fasb 52 of translating into the reporting currency the books of a completely owned
explain some examples under fasb 52 that a foreign entitys functional currency would be similar as the parent firms currencyanswer three
how are translation gains and losses handled in a different way as per to the current rate method in comparison to the other three techniques which
explain the distinction in the translation process among the monetarynonmonetary method and the temporal methodanswer within the monetary or
1 a company sold a super computer to an institute in germany on credit and invoiced dm 10 million payable in six months presently the six-month
explain cross-hedging and discuss the factors determining its effectivenessanswer cross-hedging includes hedging a position in one asset by taking a
explain contingent exposure and define the advantages of using currency options to manage this type of currency exposureanswer companies may come
should a firm hedge why or why notanswer firms may not need to hedge exchange risk in a perfect capital market but firms can add to their
recent surveys of corporate exchange risk management practices point out that many us firms simply do not hedge how would you explain this
what are the advantages or benefits of a currency options contract as a hedging tool compared with the forward contractanswer the major advantage
explain and compare the costs of hedging via the forward contract and the options contractanswer there is no up-front cost of hedging through forward
discuss and compare hedging transaction exposure by using the forward contract vs money market instruments while do the alternative hedging
how would you explain transaction exposure how is it different from economic exposureanswertransaction exposure is the sensitivity of comprehend
a us company holds an asset in france and faces the subsequent scenario state 1state 2 state 3 state
assume that you hold a piece of land in the city of london that you may wish to sell in one year like a us resident we are concerned along with the
the exchange rate uncertainty may not essentially mean that firms face exchange risk exposure describe why this may be the caseanswer a firm can
discuss the benefits and drawbacks of maintaining multiple manufacturing sites like a hedge against exchange rate exposureanswer to set up