2.3) Explain the most important Corporate Finance decisions a CFO makes to maximize firm value and comment how these decisions are different in an international company compared to a domestic company.

Please use the information in the image to explain and answer the question.

Goal: Maximization of firm value Investment decision Invest in assets that earn an expected rate of return greater than the minimum hurdle rate. Financing decision Find the right kind of debt for your firm and the optimal capital structure (right mix of debt and equity). Risk management decision Reduce volatility of your company's cash flows with the right instruments. Dividend decision If you cannot find investments that make your minimum acceptable rate, return capital to investors. The expected rate of return should reflect the magnitude and timing of future cash-flows as well as all side effects. Optimal capital structure maximizes firm value. Reduced volatility of future cash-flows maximizes firm value. How much cash you can return depends upon the current and promised investment opportunities. The hurdle rate should reflect the risk of the investment and the capital structure used to finance it. The right kind of debt matches the tenor of your assets. The right risk manage- ment instruments match the tenor and currency of your risks and minimize variation of future cash- flows. How you chose to return cash to investors will depend on whether they prefer dividends or buy- backs