an attempt to manage economic exposure, the following are examples of diversifying operating cash flows, EXCEPT: A) Diversification of sales across different countries B) Locating manufacturing facilities is various countries C) Issuing bonds in foreign countries D) Buying raw materials from more than one country P
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In an attempt to manage economic exposure, the following are examples of diversifying operating cash flows, EXCEPT:
A) Diversification of sales across different countries
B) Locating manufacturing facilities is various countries
C) Issuing bonds in foreign countries
D) Buying raw materials from more than one country P
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- A U.S.-based MNC has a subsidiary in Malaysia that generates substantial net cash inflows denominated in Ringgit Malaysia. Given this information, the MNC would ____ from a ____ of the Ringgit Malaysia. A. benefit; appreciation B. not benefit; depreciation C. benefit; depreciation D. not benefit; appreciationWhich cash flows are important for an overseas investment: those generated by the subsidiary in the country in which it operates or those sent to the parent firm in dollars?Discuss two general functions involved in international cash management and explain how the MNC’s optimization of cash flow can distort the profits of a subsidiary that is based in North America.
- A). Why do we need to translate the financial statement of foreign operations? B). Explain the concepts of local currency, functional currency and presentation, orrency with example. K C). How is the profit or loss from translating foreign operations' financial statements from local currency to functional currency treated? D) How are the profit and loss from translating foreign ope ions' financial statements from functional currency to presentation currency treated?A shift to expecting depreciation in the domestic currency will lead to: a. an inflow of capital to domestic economy b. an increase in the demand for domestic country currency- denominated financial assets c. uncovered interest parity d. a decrease in the demand for domestic country currency denominated financial assetsDiscuss the different positive and negative impacts of financial conglomerate on international cash flows.
- A. Capital flows B. Direct foreign investment C. Indirect foreign investment occurs when a company from one country makes a physical investment, such building a manufacturing facility, in another countryWhich information is reflected in the capital account of the balance of payments? a. Purchases and sales of stocks, bonds, bank accounts, real estate, and businesses. b. Purchases and sales of dollars, foreign exchange, gold, and special drawing rights. c. Export and import of goods and services. d. Capital transfers and the cross-border acquisition and disposal of natural resources and marketing assets.Functional currency is the currency that influences sales price, labour, material and other costs of a company’s goods and services. (a) Explain factors that should also be considered to determine the functional currency of a foreign operation. (b) Explain what will happen if a business transaction is denominated in foreign currency but reported in functional currency.
- Consider a US-based MNC with a wholly owned Italian subsidiary. Following a depreciation of the dollar against the euro, which of the following conclusions are correct? Group of answer choices a. The cash flow in euros could be altered due a change in the firm's competitive position in the marketplace. b. A given operating cash flow in euros will be converted to a higher US dollar cash flow. c. Both A and B d. None of the aboveWhat concept underlies the two-transaction perspective in accounting for foreign currency transactions? a. treats imports and exports as two separate transactions. b. Foreign Exchange Gains and Losses. c. The Effects of Changes in the world Economy. d. Treats the export sale and the subsequent collection of cash as two separate transactions.A. What is a multinational corporation? Why do firms expand into other countries? B. Discuss at least six major factors which distinguish multinational financial management from financial management as practiced by a purely domestic firm. (Please consider doing additional research on this question and document your findings). C. Discuss exchange rate risk as they relate to multinational corporations. D. Describe the current International Monetary System. How does the current system differ from the system that was in place prior to August 1971? (Please consider doing additional research on this question and document your findings). E. What is the difference between spot rates and forward rates? When is the forward rate at a premium to the spot rate? At a discount? (Please consider doing additional research on this question and document your findings). F. From a managerial point of view, disc