1 Portfolio:
Choose a company throughout this course you will be "following" a Multi-National Corporation (MNC) and performing a series of reports, case studies, and activities that intend for you to see how an organization operates on the international level. You may choose from the list of pre-approved MNCs below:
1. American International Group
2. Capital One
3. Coca-Cola
4. Royal Dutch Shell
5. Wal-Mart
For this assignment, you are to choose an MNC that you want to research throughout the course and submit if for approval. Your topic approval should include the name of the MNC and a description of why the organization is considered an MNC, You should also choose one of the objectives below to perform a minimum 200 word analysis of how the objective applies to your chosen MNC.
Objectives:
1. Examine the concept of the current account balance.
2. Employ the current account balance to extend national income accounting to open economies.
3. Apply national income accounting to the interaction of saving, investment, and net exports.
4. Evaluate and discuss the national money markets in which interest rates are determined.
5. Compare how monetary policy and interest rates feed into the foreign exchange market.
6. Discuss the concept of the real exchange rate.
7. Analyze the factors that affect real exchange rates and relative currency prices in the long run.
8. Explain the role of the real exchange rate in determining the aggregate demand for a country's output.
9. Demonstrate causes and effects of balance of payments crises.
10. Evaluate how alternative multilateral systems for pegging exchange rates work.
11. Explain how the goals of internal and external balance motivate economic policy makers in open economies.
12. Summarize how the monetary and fiscal policies of a large country such as the United States are transmittedabroad.
13. Analyze the economic function of international portfolio diversification.
14. Explain factors leading to the explosive recent growth of international financial markets.
15. Analyze problems in the regulation and supervision of international banks and nonbank financial institutions.
2 Portfolio
For your second assignment, you are to perform some preliminary investigation into the MNC you chose by performing a brief survey and creating a portfolio. Start with the history of the organization and provide some brief background into how the organization entered the international stage and how globalization has played a part in the organization's growth. When creating the portfolio, you should provide examples of the types of transactions the MNC has made within foreign exchange markets and if there are netting arrangements the organization has made. You should also investigate the purpose of the company's actions and what this will mean for them in short-term and long-term arrangements with other corporations. For example:
1 Did they have to purchase stock of a company
2 Will they owe significant monies due to the foreign exchange deal
3 Will this affect their cash flow
4 Will the appreciation or depreciation of exchange rates affect their transaction
These are just a few questions to get your mind jogging on this topic. Based upon your readings, you should be able to come up with some questions of your own that are more specific to the company you chose, and the types of transactions they make within the forex market. This assignment is important to understanding interactions companies make within international markets and how this affects everyone, down to the end-user.