Questions from Corporate Finance


Q: Explain why infrastructure strengths have helped to offset the large BOP deficits

Explain why infrastructure strengths have helped to offset the large BOP deficits on current account in the United States.

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Q: The emerging market crises of 199–2002 were worsened because of

The emerging market crises of 199–2002 were worsened because of rampant speculation. Do speculators cause such a crisis, or do they simply respond to market signals of weakness? How can a government m...

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Q: Swings in foreign direct investment flows into and out of emerging markets

Swings in foreign direct investment flows into and out of emerging markets contribute to exchange rate volatility. Describe one concrete historical example of this phenomenon during the last 10 years....

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Q: What were the main causes of Thailand’s crisis of 1997? What

What were the main causes of Thailand’s crisis of 1997? What lessons were learned and what steps were eventually taken to normalize Thailand’s economy?

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Q: What were the main causes of Russia’s crisis of 1998? What

What were the main causes of Russia’s crisis of 1998? What lessons were learned and what steps were taken to normalize Russia’s economy?

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Q: What were the main causes of Argentina’s crisis of 2001–2002

What were the main causes of Argentina’s crisis of 2001–2002? What lessons were learned and what steps were taken to normalize Argentina’s economy?

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Q: How would a high degree of leverage (debt/assets)

How would a high degree of leverage (debt/assets) be viewed by the shareholder wealth maximization model compared to the stakeholder wealth maximization model?

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Q: Explain why foreign currency cash balances do not cause transaction exposure.

Explain why foreign currency cash balances do not cause transaction exposure.

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Q: The value of an option is stated to be the sum of

The value of an option is stated to be the sum of its intrinsic value and its time value. Explain what is meant by these terms.

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Q: Ultimately a treasurer must choose among alternative strategies to manage transaction exposure

Ultimately a treasurer must choose among alternative strategies to manage transaction exposure. Explain the two main decision criteria that must be used.

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