internatonan QUESTIONS AND APPLICATIONS 1. Impact of September 11. Following the ter rorist attack on the United States, the valuations of many MNCs declined by more than 10 percent Explain why the expected cash flows of MNCs were foreign firm. reduced, even if they were not directly hit by the terrorist attacks. teurism) 2. Valuation of an MNC. Hudson Co., a U.S. firm, has a subsidiary in Mexico, where political risk has recently increased. Hudson's best guess of its future peso cash flows to be received has not changed. However, its valuation has declined as a result of the n more internat increase in political risk. Explain.( pe tat 3. Impact of Political Risk. Explain why political a U.S. firm, has a French subsidiary that produces risk may discourage international busines 4. Impact of Exchange Rate Movements. Plak Co. of Chicago has several European subsidiaries tha firm or by acquiring a foreign firm. Explain the dif ferences in potential risk and return between a licens ing agreement with a foreign firm and the acquisition of a 8. International Opportunities Due to the Internet. a. What factors cause some firms to become more internationalized than others? b. Offer your opinion on why the Internet may result 9. Exposure to Exchange Rates. McCanna Corp wine and exports to various European countries. All of the countries where it sells its wine use the euro as their currency, which is the same currency used in France. Is McCanna Corp. exposed to exchange rate risk? remit earnings to it each year. Explain how apprecia tion of the euro (the currency used in many European countries) would affect Plak's valuation. nNrt.-1 10. International Opportunities. Do you think the acquisition of a foreign firm or a. International Business Methods. Snyder Golf 5. Co., a U.S. firm that sells high-quality golf clubs in the United States, wants to expand internationally by sell ing the same golf clubs in Brazil. a. Describe the tradeoffs that are involved for each method (such as exporting, direct foreign investment, etc.) that Snyder could use to achieve its goal licensing will result in greater growth for an MNC? Which alternative is likely to have more risk? b. I - b. Which method would you recommend for this firm? Justify your recommendation 6. Benefits and Risks of International Business. As an overall review of this chapter, identify possible reasons for growth in international business. Then, list the various disadvantages that may discourage inter national business Describe a scenario in which the size of a corpo- ration is not affected by access to international opportunities. c. Explain why MNCs such as Coca-Cola and PepsiCo, Inc, still have numerous opportunities for international expansion 11. Macro versus Micro Topics. Review the Table of Contents and indicate whether each of the chapters from Chapter 2 through Chapter 21 has a macro or micro perspective 12. Imperfect Markets. a. Explain how the existence of imperfect markets has led to the establishment of subsidiaries in foreign 7. Methods Used to Conduct International Business. Duve, Inc. desires to penetrate a foreign market with either a licensing agreement with a foreign markets. internatonan QUESTIONS AND APPLICATIONS 1. Impact of September 11. Following the ter rorist attack on the United States, the valuations of many MNCs declined by more than 10 percent Explain why the expected cash flows of MNCs were foreign firm. reduced, even if they were not directly hit by the terrorist attacks. teurism) 2. Valuation of an MNC. Hudson Co., a U.S. firm, has a subsidiary in Mexico, where political risk has recently increased. Hudson's best guess of its future peso cash flows to be received has not changed. However, its valuation has declined as a result of the n more internat increase in political risk. Explain.( pe tat 3. Impact of Political Risk. Explain why political a U.S. firm, has a French subsidiary that produces risk may discourage international busines 4. Impact of Exchange Rate Movements. Plak Co. of Chicago has several European subsidiaries tha firm or by acquiring a foreign firm. Explain the dif ferences in potential risk and return between a licens ing agreement with a foreign firm and the acquisition of a 8. International Opportunities Due to the Internet. a. What factors cause some firms to become more internationalized than others? b. Offer your opinion on why the Internet may result 9. Exposure to Exchange Rates. McCanna Corp wine and exports to various European countries. All of the countries where it sells its wine use the euro as their currency, which is the same currency used in France. Is McCanna Corp. exposed to exchange rate risk? remit earnings to it each year. Explain how apprecia tion of the euro (the currency used in many European countries) would affect Plak's valuation. nNrt.-1 10. International Opportunities. Do you think the acquisition of a foreign firm or a. International Business Methods. Snyder Golf 5. Co., a U.S. firm that sells high-quality golf clubs in the United States, wants to expand internationally by sell ing the same golf clubs in Brazil. a. Describe the tradeoffs that are involved for each method (such as exporting, direct foreign investment, etc.) that Snyder could use to achieve its goal licensing will result in greater growth for an MNC? Which alternative is likely to have more risk? b. I - b. Which method would you recommend for this firm? Justify your recommendation 6. Benefits and Risks of International Business. As an overall review of this chapter, identify possible reasons for growth in international business. Then, list the various disadvantages that may discourage inter national business Describe a scenario in which the size of a corpo- ration is not affected by access to international opportunities. c. Explain why MNCs such as Coca-Cola and PepsiCo, Inc, still have numerous opportunities for international expansion 11. Macro versus Micro Topics. Review the Table of Contents and indicate whether each of the chapters from Chapter 2 through Chapter 21 has a macro or micro perspective 12. Imperfect Markets. a. Explain how the existence of imperfect markets has led to the establishment of subsidiaries in foreign 7. Methods Used to Conduct International Business. Duve, Inc. desires to penetrate a foreign market with either a licensing agreement with a foreign markets