Assignment Ch. 1 (International Financial Management - 1 Year Option, 12th Edition)

Jeff Madura

1. International Opportunities.

a. Do you think that either the acquisition of a foreign firm or licensing will result in greater growth for an MNC? Which alternative is likely to have more risk?

b. Describe a scenario in which the size of a corporation is not affected by access to international opportunities.

c. Explain why MNCs such as Coca Cola and PepsiCo, Inc., still have numerous opportunities for international expansion.

2. International Opportunities Due to the Internet.

a. What factors cause some firms to become more internationalized than others?

b. Offer your opinion on why the Internet may result in more international business.

3. Impact of Exchange Rate Movements. Plak Co. of Chicago has several European subsidiaries that remit earnings to it each year. Explain how appreciation of the euro (the currency used in many European countries) would affect Plak's valuation.

4. Benefits and Risks of International Business. As an overall review of this chapter, identify possible reasons for growth in international business. Then, list the various disadvantages that may discourage international business.