FIN%204220%20International%20Finance%20examination%203%20chapters%2011-14%20WCC

# FIN%204220%20International%20Finance%20examination%203%20chapters%2011-14%20WCC

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FIN 4220 International Finance Chapter Problems 11,12,14 and WCC 1. WCC problem 1: MNE Raising Funds Domestically Debt target rate is 45% Equity target rate 55% Debt \$ 0-1,000,000 after-tax cost 4% 1,000,000-2,000,000 4.5% 2,000,000-3,000,000 5% 3,000,000 + 6% Equity \$0-500,000 5.25% 500,000-800,000 6% 800,000 + 7% 2. WCC problem 2: MNE Raising Funds Internationally The same optimal target rates for Debt and Equity Apply Debt 0-\$2,000,000 3.5% \$2,000,000-4,000,000 4% \$4,000,000 + 4.5% Equity 0-\$500,000 5.25% \$500,000 -\$1,500,000 5.5% \$1,500,000 + 5.75% 3. Graph the results for problems 1 and 2 (on the same graph) 4. Chapter 11 Settle Scientific. Josh Miller is chief financial officer of a medium- sixed Seattle-based medical device manufacturer. The company’s annual sales of \$40 Million have been growing rapidly, and working capital financing is a common source of concern. He has recently been approached by one of his major Japanese customers. Yokasa typically orders ¥12,500,000 monthly. The current

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FIN%204220%20International%20Finance%20examination%203%20chapters%2011-14%20WCC

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