Hi Tutor,

I have an assignment about Finance. This is an assignment file. I need the references and one page of each questions will be great. Please do it in APA format ( Times New Roman 12) and Due date is on this Saturday morning (10.00am.)

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Week 1 Analytical Application Using International Financial Markets Worcester Tool Company is a large, U.S.-based, multinational corporation with subsidiaries in eight different countries. The parent of Worcester provided an initial cash infusion to establish each subsidiary. Each subsidiary, however, has had to finance its own growth since then. The parent and subsidiaries of the firm typically use Citigroup (with branches in numerous countries) when possible to facilitate any flow of funds necessary. a. Explain the various ways in which Citigroup could facilitate Worcester's flow of funds, and identify the type of financial market where that flow of funds occurs. For each type of financing transaction, specify whether Citigroup would serve as the creditor or would simply facilitate the flow of funds to the firm. b. Recently, the British subsidiary called on Citigroup for a medium-term loan and was offered the following alternatives. LOAN DENOMINATED IN British pounds U.S. dollars Canadian dollars Japanese yen ANNUALIZED RATE 13% 11% 10% 8% Week 1 Analytical Application Using International Financial Markets Worcester Tool Company is a large, U.S.-based, multinational corporation with subsidiaries in eight different countries. The parent of Worcester provided an initial cash infusion to establish each subsidiary. Each subsidiary, however, has had to finance its own growth since then. The parent and subsidiaries of the firm typically use Citigroup (with branches in numerous countries) when possible to facilitate any flow of funds necessary. a. Explain the various ways in which Citigroup could facilitate Worcester's flow of funds, and identify the type of financial market where that flow of funds occurs. For each type of financing transaction, specify whether Citigroup would serve as the creditor or would simply facilitate the flow of funds to the firm. The bank (Citigroup) can facilitate the flow of funds for any company in many ways. First of all the bank can also provide loans for the short term, like for the inventory and other current assets. In this case also the bank serves as the creditor. Secondly the bank can provide the loans for the long term to finance the longterm assets. In this transaction the bank would serve as the creditor for the long term.[Usi15] In case the company wants to float ADR or GDR, the bank (Citigroup) can facilitate and act as the custodian for the shares and issue ADR OR GDR in foreign currency. [Wha157] In this case they are acting as facilitator. Company may also want to raise capital through bonds. Bank can help in the same and here too they would act as the facilitator b. Recently, the British subsidiary called on Citigroup for a medium-term loan and was offered the following alternatives. LOAN DENOMINATED IN British pounds U.S. dollars Canadian dollars Japanese yen ANNUALIZED RATE 13% 11% 10% 8% Ideally the company would take the loan at the least annualized rate. Hence if this is the only condition then the company (British subsidiary) would take loan in Japanese Yen. However, now let me compare which one is the best financing alternative for the British subsidiary between each currency as following. - Japanese yen, over the last three years (2012-2015) depreciates against the British Pound, so it is good if the value of Japanese Yen in the future still keep decreasing in value when there is a due date for the British Subsidiary to repay the loan because they can benefit from the appreciation of the British Pound. [Jap15] - Comparing the US dollar to the British Pound has high fluctuation over the last there years (2012 -2015) so it is risky for the company if it takes a loan in the US dollar. There are two main reasons that the company would not take the loan in the US dollar. First, there is a higher rate of loan compared to Canadian dollar and Japanese Yen. Secondly, the fluctuation of the US dollar against the British Pound is high over the last there years.[The152] - Canadian dollar mostly a bit appreciates against the British Pound over many years except at the end of 2013, and it is a bit stable now compared to the British Pound. If the British Pound deprecates against the Canadian dollar as it generally is at the end of the loan, then the company will lose benefit from the exchange rate. [Can15] By comparing between these currencies, I think the company would take the loan in Japanese Yen since there is the lowest rate of loan, and the currency is mostly depreciate against the British Pound. However, the British subsidiary would have to consider exchange rate risk in the future while they would be repaying the loan. Also political and the economic condition in Japan might add to the risk for the company. [Pol15] All these factors would be considered before taking any decision. References Canadain Dollar to British Pound. (n.d.). Retrieved 7 10, 2015, from https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF8#q=1 CAD to GBP Japanese Yen to British Pound. (n.d.). Retrieved 7 10, 2015, from https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF8#q=1 JPY to GBP Political Stability and Economic Performance. (n.d.). Retrieved 7 10, 2015, from Investopedia: http://www.investopedia.com/articles/basics/04/050704.asp The US dollar to British Pound. (n.d.). Retrieved 7 10, 2015, from https://www.google.com/webhp?sourceid=chrome-instant&ion=1&espv=2&ie=UTF8#q=1 USD to GBP What Is An ADR? (n.d.). Retrieved 7 10, 2015, from investopedia: http://www.investopedia.com/university/adr/adr1.asp Using International Financial Markets Worcester Tool Company. (n.d.). Retrieved 7 10, 2015, from Course Hero: https://www.coursehero.com/tutors-problems/Finance/8546555- Using-International-Financial-Markets-Worcester-Tool-Company-is-a-lar/