QUESTION 3 Discuss the conflict of interest which may arise between two oil-producing cartel members if one member holds a significantly large amount of reserves than the other member? For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac) BIUS Paragraph Arial V 10pt AVA
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- What do you know about arbitrage opportunity? Discuss with examples. Also, present a scenario of any type of international arbitrage if possible. If so, how would it be executed and how would market forces be affected? Does arbitrage opportunity destabilize foreign exchange markets?Assume Country X has an electricity market with supply and demand being given below: Qp = -Pp + 200 Qs = -3Ps + 300 Part C- horizontally-integrated market If the government decides to reform the electricity market so that there are a number of power plant firms as well as a number of electricity distribution firms. The electricity market will now be controlled by a regulator using an auction system. A sample of the bids is given by the table below: Electricity Producers Electricity Distribution Asking price / KWh quantity/KWh Asking price / KWh quantity/KWh 0.74 25 0.56 30 0.32 20 0.34 60 0.46 35 2$ 0.55 25 0.53 25 0.64 25 0.64 30 2$ 0.43 40 By studying the bids, 1· Find the range of the equilibrium market price 2. Find the equilibrium market quantity 3. Find the total welfareInternationalization theory suggests that Select one: a. FDI is more likely to take place when the costs of negotiating, monitoring, and enforcing a contract with a second firm is higher. Ob. FDI is more likely to occur when prices are high, competition is intense and lower trade barriers as well as exchange rates are strong. O c. FDI occurs in developing countries only in order to boost their economies and improve the country position. d. None of the options are applicable. Next page
- Country risk is: Group of answer choices A. The risk that a counterparty or obligor will not be able to pay its obligations because of cross-border restrictions. B. An assessment of the political and economic risk of a country. C. Both A & B D. Neither A or Ba)fast internationalization strategy for Better Generation has some associated risks. What are these risks? b) Better Generation requires some resources for a fast internationalization strategy. How can Better Generation build these resources? c) How should Better Generation develop its international strategy in terms of countries chosen and entry modes?Investors and MNCs exporting or importing goods and services or making foreign investments throughout the global economy are faced with an exchange rate risk,which can have severe financial consequences on firms profitability,cash flows,and their market value,if not managed appropriately. MNC's use a number of external techniques of risk(exposure)management and resort to contractual relationships outside thier companies in order to reduce (or redistribute)the risk of foreign exchange losses.What are the determinants of hedging currency risk or foreign exchange exposures which pose risks to MNC's cashflows,competitiveness,marker value and financial reporting.
- The best public policy solutions typically do not involve protectionism, but instead involve finding ways for public policy to address the particular issues resulting from disruptions, costs, and tradeoffs, while still allowing the benefits of international trade to occur. Select the correct answer below: O True O FalseQUESTION 1 In a forfaiting transaction, the forfait buys the notes at a discount from face value from the importer. buys the notes at a discount from face value from the exporter. redeems the notes at a face value to the exporter. Onone of the options QUESTION 2 Depending on the manner in which firms are affected, political risk can be operational and control risk only transfer, operational, and control risk operational and transfer risk only. transfer and operational risk only Click Save and Submit to save and submit. Chick See All Am O Ht redWhich of the following risk responses would be most likely to be given consideration for an organization which is a trade importer and exporter? a. Reduce risk b. Avoid risk c. Share risk d. Accept risk
- Download Image Download PDF Question in a complex multinational business scenario involving intercompany transactions, varying tax jurisdictions, and significant foreign currency exposure, analyze and prepare consolidated financial statements adhering to International Financial Reporting Standards (IFRS) while considering the impacts of transfer pricing regulations, hedging strategies, and compliance with local tax laws.What are the major advantages of international expansion to FIs? Explain how each advantage can affect the operating performance of FIs.