a. Opportunities: investment opportunities; enhancing revenues (global branding, marketing flexibility, advantages of scale and scope); reducing operating costs (low cost materials, labor, flexibility in global site selection, flexibility in sourcing and production, economies of scale and scope, economies of vertical integration); multinational business strategy (following the customer, leading the customer, following the leader, going local) b. Risks: differences in legal, accounting, and tax systems; differences in personnel management (i.e. HR practices); differences in marketing; differences in distribution; differences in financial markets; differences in corporate governance 2. Given the following Euro to $ Exchange rate of 1.46, what is the information contained in this quote?
Equity vs. debt securities Debt securities represent debt incurred by the issuer. （拥有此证券代表你拥有对证券发行人的债权，发行人是你的债务人) Equity securities represent equity or ownership in the firm.（拥有此证券代表你拥有证券标的物的财产所有权） Primary vs. Secondary markets Primary markets facilitate the issuance of new securities. Secondary markets facilitate the trading of existing securities and is liquidity. Money vs. Capital markets Money markets facilitate the sale of short-term (one year or less)
| Quality of financial system in which country the company is operating, i.e., how available debt is. | Source: Financial Management; Theory and Practice http://creditexpert.dnb.com/small-business-information/the-difference-between-business-risk-and-financial-risk/ b. When a company only finances through equity total risk is defined by business risk. But when it is the combination of equity financing and debt financing, total risk is the combination of business risk and financial risk. Total risk can be measured by company’s Return on Equity (ROE).
At the same time, there are increasing concerns about the fact that concentration in the financial system has increased; big banks may feel less competitive pressure to lend – despite the fact that they are highly profitable. The “Too Big to Fail” bailout of our big banks will have the most resounding effect on economic future. The latest quarterly report from the Neil Barofsky, the Special Inspector General for the Troubled Asset Relief Program (TARP), is the best official articulation yet of why Too Big To Fail is here to stay in the United States – and we are likely on the path to these institutions (Johnson & Kurtz, 2011) becoming Too Big To Save. There are moral hazard and potentially dire consequences associated with the continued presence of financial institutions that are deemed ‘too big to
Answer: True Difficulty: Easy LO: 1 Page: 410 T F 5. Generally, it is not a good idea to participate in an employer-sponsored retirement program. Answer: False Difficulty: Easy LO: 1 Page: 410 T F 6. The rate of return on an investment has no affect on a long-term investment program. Answer: False Difficulty: Med LO: 2 Page: 414 T F 7.
.714 B. 9.09 C. 29.86 D. 7.14 E. none of the above. Based on test bank questions 17.35 and 17.37, DOL = [(36,000 + 21,000)/21,000]/[(1,200,000 - 1,100,000)/(1,100,000) = 2.7143/.0909 = 29.86 Difficulty: Difficult 40. Classifying firms into groups, such as _________ provides an alternative to the industry life cycle. A. slow-growers B. stalwarts C. countercyclicals D. A and B E. A and C The groups in this classification are slow-growers, stalwarts, fast-growers, cyclicals, turnarounds, and asset plays.
But for investors who own the callable bonds, costs of repo and short selling don’t exist. Conclusion: The existence of costs for taxation and transaction can only partially explain why arbitrage opportunity exists for a long time. It might be that the number of arbitrageurs is relatively small and they have inadequate capital, their ability to drive market prices to fundamental values is
The number of sales is stronger than Lowe’s. Lowe’s sales per transaction and sales per store increases faster than Home Depot’s, and Lowe’s had larger debt than Home Depot. Value Line Publishing is in the business of producing financial forecasts to aid individuals and institutions in the analysis of potential investments. The nature of forecasting the future state of companies and their underlying stock prices is inherently difficult for multiple reasons. Evaluating the countless variables that influence stock price movements is a subjective task that requires a combination of understanding of market, economic concepts and the ability to implement those concepts in relation to industry and firm-specific
Some of the similarities to a closely held corporation is each shareholder's liability is limited to the amount of their investment. There is also a limited supply of shares for the market, which make these shares less desirable to the market. The legal limit of shares in a S-corporation is 100 shares and in a C-corporation it is unlimited. S-corporations cannot sale their shares on the foreign market since foreigners don't pay individual income taxes. Shareholders vote to becoming a s-corporation and one or more shareholder holding 50 percent or more of the shares can revoke becoming a s-corporation.
China is also too passive and does not take part in global politics and issues significantly. They have not been willing to shoulder the responsibility of maintaining international order even after emerging as one of the most powerful states in the world, and are more isolationist as compared to the US. For example, during crises such as the Ebola outbreak, their monetary pledge of 38 million is far lower than the 175 million pledged by the US. It was the US who led the international efforts, be it monetary aid or humanitarian aid, to combat the Ebola outbreak in West Africa.