A firm based in Mexico has found that its growth is restricted by the limited liquidity of the Mexican capital market. List the firm's options for raising money on the global capital market. Discuss the pros and cons of each option, and make a recommendation. How might your recommended options be affected if the Mexican peso depreciates significantly on the foreign exchange markets over the next two years? To raise money in the global capital markets, the seeking companies can work towards equity or debt loans. Another option for raising the money in the capital market is taking a debt from the foreign institution, lenders and other debt providers (Hill, C. W . 2011). As equity loans includes selling stock to investors, while debt loans include issuing bonds. The cost of capital is usually lower than it would be in the domestic market and the firm even can borrow money from bank. And the firms must be very careful to factor in risk of adverse exchange rates as if the peso is expected to depreciate, the firm should be aware that it will cost more to purchase the currency necessary to repay a foreign currency loan. Moreover, about the Mexican firm, it could consider foreign equity offerings, floating foreign or Eurobonds, or borrowing on Euro currency markets. Domestically, the Euro currency market will certainly make additional funds available to the firm at the lower rate. And if the peso falls in the next two years, then the firm will have to pay back the loan in another currency unless the firm is able to use the forward market. It would definitely decrease the attractiveness of Euro currency loans. We can identify that the use of both the foreign and euro bonds have the same drawbacks as the bonds will have to be paid back in a currency which is appreciated against the peso. The international bond market has strong points that make it worth considering if the currency risk