Autumn2005- TBS 907-Lecture 10- International Finance

Of issues to be considered should the decision to

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Unformatted text preview: sh flows received by the parent company or the project cash flows What discount rate should be used Cost of Capital to be based on Capital Structure of Group or Subsidiary undertaking the project. Problems with evaluating a foreign projects Managing Risk in Foreign Operations Risks of Foreign Investments Country Risk Political Risk Economic Risk Foreign Exchange Risk Economic Exposure Transaction Exposure Translation Exposure Economic Exposure Exchange rate risk as applied to the firm's competitive position. Any anticipated changes in the exchange rates would have been already discounted and reflected...
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