Explain how the cost of capital for multinational companies

Assignment Help Business Management
Reference no: EM132564837

1) Wizard, Inc. has a subsidiary in a country where the government allows only a small amount of earnings to be remitted to the U.S. each year. Should Wizard finance the subsidiary with debt financing by the parent, equity financing by the parent, or financing by local banks in the foreign country?

2) Explain how the cost of capital for Multinational Companies may differ from that for purely domestic firms (Hint the book lists 5 major differences).

3) LaSalle Corp. is a U.S.-based MNC with subsidiaries in various less developed countries where stock markets are not well established. How can LaSalle still achieve its "global" target capital structure of 50 percent debt and 50 percent equity, if it plans to use only debt financing for the subsidiaries in these countries?

Reference no: EM132564837

Questions Cloud

What is the expected net interest income : What is the expected net interest income at the end of the year?
Flexible exchange rate than a small country : A large country is more open to adopt a flexible exchange rate than a small country. Critically evaluate this statement with examples.
What is the ocf for project : If the tax rate is 34 percent, what is the OCF for this project?
What is the apr on this loan if you make monthly payments : What is the APR on this loan if you make monthly payments and your upfront closing costs are $2,500?
Explain how the cost of capital for multinational companies : Explain how the cost of capital for Multinational Companies may differ from that for purely domestic firms (Hint the book lists 5 major differences).
Compute the implied profit and the rate of return : A Treasury manager at Barclays Bank can borrow for 3 months at 10.15% and make a 3 month loan at 10.25%.
Why do firms go for vertical mergers and acquisitions : Why do firms go for vertical mergers and acquisitions? Are more such integrations better than less? Comment on their importance in the future.
Explain the underlying behavior finance concepts : Explain the underlying behavior finance concepts involved and how they drive the investment decision making.
Exchange ratio between the two stocks : YQR has a market value of $125 million and 5 million shares outstanding. HKG has a market value of $40 million and 2 million shares

Reviews

Write a Review

Business Management Questions & Answers

  A message from a gym manager to clients about temporarily

A message from a gym manager to clients about temporarily closing the pool in the gym

  Describe answer and support your answer with sources

As a project manager/manager which would you prefer on your team - the best of the best (skill, performance, leadership, experience, etc...)

  What is collusion

1. What is collusion? How can collusion affect the bidding process? What can be done to counter it?

  Each of the psychoanalytic-social personality theories

What are the main components of each of the psychoanalytic-social personality theories? What are some of the main differences between theories?

  Why did honda campaign become popular

Why did Honda's campaign become popular? Has the Honda Facebook campaign been effective?

  What is the derivative of the average cost function

The average cost of producing a pair of shoes is given by A(n)=C(n)/n. What is the derivative of the average cost function?

  Advantages of small entrepreneurial companies

What are at least five potential competitive advantages of small entrepreneurial companies compared to large firms?

  Role of strategic planning in creating value

Provide an example of how a company uses strategic planning to create value for an organization.

  Calculate marginal revenue as a function of q

It current charges $1.50 per bottle. If it lowers price by 10 cents to $1.40 on every bottle than it expects to sell 100,000 additional bottles per day.

  Author feelings about increased government oversight

What are examples of firms in an oligopolistic market that abuse their power? Explain how they abuse their power and describe the impact on consumers. Do you agree with the author's feelings about increased government oversight of such industries? ..

  Successful recruitment of talented

What should employers consider about compensation and benefits for successful recruitment of talented Gen Xers and millennials?

  Explain the importance of treating customers as individuals

Explain the relationship between customers' needs and expectations and customer satisfaction

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd