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strayer university finc535 Week 1 Homework




Question;Week;1 Homework;International;Finance: 535;Strayer;University;Fall;2013;17. International Joint Venture;A. Explain;how the joint venture enabled Anheuser-Busch to achieve its objective of;maximizing shareholder wealth.;B. Explain;how the joint venture limited the risk of the international business.;C. Many international joint ventures are intended to circumvent;barriers that normally;prevent foreign;competition. What barrier in Japan did;Anheuser-Busch circumvent as a;result of the;joint venture? What barrier in the;United States did Kirin circumvent as a;result of the;joint venture?;D. Explain how Anheuser-Busch could have lost some of its market share;in countries;outside Japan as;a result of this particular joint venture.;21. Valuation;of Wal-Mart?s International Business;1.;Explain how to determine the;present value (in dollars) of the non-U.S. part assuming;that you had;access to all the details of Wal-Mart businesses outside the United States.;22. Impact of International Business on;Cash Flows and Risk;A.;Explain why Nantucket may;be able to effectively capitalize on international;opportunities such as the Greek island tours.;B.;Nantucket is;privately-owned by owners who reside in the U.S. and work in the main;office. Explain possible agency;problems associated with the creation of a subsidiary;in Athens, Greece. How can Nantucket;attempt to reduce these agency costs?;C. Greece?s;cost of labor and rent are relatively low. Explain why this information is;relevant to Nantucket?s decision to;establish a tour business in Greece.;D. Explain how the cash flow situation of the Greek tour business;exposes Nantucket to;exchange rate;risk. Is Nantucket favorably or unfavorably affected when the euro;(Greece?s;currency) appreciates against the dollar? Explain..;E. Nantucket plans to finance its Greek tour business. Its subsidiary;could obtain loans in;Euros from a;bank in Greece to cover its rent, and its main office could pay off the loans;over time.;Alternatively, its main office could borrow dollars and would periodically;convert dollars;to Euros to pay the expenses in Greece. Does either type of loan reduce;the exposure of;Nantucket to exchange rate risk? Explain.;F. Explain;how the Greek island tour business could expose Nantucket to country risk.;27. Exposure of MNCs to Exchange Rate;Movements;1.;Do you think that the exchange rate movements;will have a favorable or unfavorable;effect on the MNC?


Paper#49429 | Written in 18-Jul-2015

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