EBK CFIN
6th Edition
ISBN: 9781337671743
Author: BESLEY
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Chapter 1, Problem 11PROB
Summary Introduction
To determine: factors that make financial decision-making more difficult for firms that operate in foreign markets
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How is multinational financial management different from financial management as practicedby a firm that has no direct contacts with foreignfirms or customers? What special problems andchallenges do multinational firms face? Whatfactors cause companies to “go multinational”?
Why do firmsexpand into other countries?
Multinational management commonly do NOT fully understand:
a.
institutions, history and culture.
b.
the risk of foreign exchange.
c.
country and political risks.
d.
financial mechanism.
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