Questions from Financial Management

Q: Co. is a U.S. firm that has a

Co. is a U.S. firm that has a subsidiary in China. The subsidiary reinvests half of its net cash flows into operations and remits half to the parent. Biloxi Co. has expected cash flows from its domest...

Q: a. Assume that Bangor Co., a U.S.

a. Assume that Bangor Co., a U.S. firm, knows that it will have cash inflows of $900,000 from domestic operations, cash inflows of 200,000 Swiss francs due to exports to Swiss operations, and cash out...

Q: Odessa Co., Midland Co., and Roswell Co. are U

Odessa Co., Midland Co., and Roswell Co. are U.S. firms in the same industry and have the same valuation as of yesterday, based on the present value of the future cash flows of each company. Odessa Co...

Q: Assume that Alpine Co. is a U.S. firm

Assume that Alpine Co. is a U.S. firm that has direct foreign investment in Brazil as a result of establishing a subsidiary there. Political conditions have changed in Brazil, but investors’ best gues...

Q: a. Rochester Co. is a U.S. firm

a. Rochester Co. is a U.S. firm that operates a language institute in France. This institute attracts Americans who want to learn the French language. Rochester Co. charges tuition to the American stu...

Q: a. What are the main components of the current account?

a. What are the main components of the current account? b. What are the main components of the capital account?

Q: Assume a simple world in which the United States exports soft drinks

Assume a simple world in which the United States exports soft drinks and beer to France and imports wine from France. If the United States imposes large tariffs on the French wine, explain the likely...

Q: There has been considerable momentum to reduce or remove trade barriers in

There has been considerable momentum to reduce or remove trade barriers in an effort to achieve “free trade.” Yet one disgruntled executive of an exporting firm stated, “Free trade is not conceivable;...

Q: Go to the currency converter at finance. yahoo.com/

Go to the currency converter at finance. yahoo.com/currency-converter and determine the bid/ask spread for the euro. Then determine the bid/ask spread for a currency in a less developed country. What...

Q: MNCs commonly invest in foreign securities. a. Assume that the

MNCs commonly invest in foreign securities. a. Assume that the dollar is presently weak and is expected to strengthen over time. How will these expectations affect the tendency of U.S. investors to in...