Voyevodins' Library _ "International Business: Competing in the Global Marketplace" / Charles W.L. Hill ... Chapter 11 ... gross domestic product (GDP), gross fixed capital formation, gross national product (GNP), group, Heckscher-Ohlin theory, hedge fund, Helms-Burton Act, historic cost principle, home country, horizontal differentiation, horizontal foreign direct investment, host country, human development index, human resource management, import quota, individualism, individualism versus collectivism, inefficient market, infant industry argument, inflows of FDI, initial rate, innovation, integrating mechanisms, intellectual property, internal forward rate, internalization theory, International Accounting Standards Committee (IASC), international business, international division, International Fisher Effect, International Monetary Fund (IMF), international strategy, international trade, ISO 9000, joint venture, just-in-time (JIT), lag strategy, late-mover advantage, law of one price, lead market, lead strategy, lean production systems, learning effects Voevodin's Library: gross domestic product (GDP), gross fixed capital formation, gross national product (GNP), group, Heckscher-Ohlin theory, hedge fund, Helms-Burton Act, historic cost principle, home country, horizontal differentiation, horizontal foreign direct investment, host country, human development index, human resource management, import quota, individualism, individualism versus collectivism, inefficient market, infant industry argument, inflows of FDI, initial rate, innovation, integrating mechanisms, intellectual property, internal forward rate, internalization theory, International Accounting Standards Committee (IASC), international business, international division, International Fisher Effect, International Monetary Fund (IMF), international strategy, international trade, ISO 9000, joint venture, just-in-time (JIT), lag strategy, late-mover advantage, law of one price, lead market, lead strategy, lean production systems, learning effects


 Voyevodins' Library ... Main page    "International Business: Competing in the Global Marketplace" / Charles W.L. Hill ... Contents



Texts belong to their owners and are placed on a site for acquaintance.

Chapter 11 Outline

Critical Discussion Questions

  1. Why has the global capital market grown so rapidly in recent decades? Do you think this growth will continue throughout the 2000s? Why?

  2. A firm based in Mexico has found that its growth is restricted by the limited liquidity of the Mexican capital market. List the firm's options for raising money on the global capital market. Discuss the pros and cons of each option, and make a recommendation. How might your recommended options be affected if the Mexican peso depreciates significantly on the foreign exchange markets over the next two years?

  3. Happy Company wants to raise $2 million with debt financing. The funds are needed to finance working capital, and the firm will repay them with interest in one year. Happy Company's treasurer is considering three options:

    1. Borrowing US dollars from Security Pacific Bank at 8 percent.

    2. Borrowing British pounds from Midland Bank at 14 percent.

    3. Borrowing Japanese yen from Sanwa bank at 5 percent.

    If Happy borrows foreign currency, it will not cover it; that is, it will simply change foreign currency for dollars at today's spot rate and buy the same foreign currency a year later at the spot rate then in effect. Happy Company estimates the pound will depreciate by 5 percent relative to the dollar and the yen will appreciate 3 percent relative to the dollar in the next year. From which bank should Happy Company borrow?

<< Chapter Summary
The Search for Capitalin the Czech Republic >>