Which of the following is NOT identified as a primary country-specific risk by the authors?
A. Thin equity base
B. Cultural differences
C. Protectionism
D. Transfer risk
Which option does NOT represent a potential drawback of licensing when compared to Foreign Direct Investment (FDI)?
A. possible loss of quality control
B. establishment of a potential competitor in third-country markets
C. possible improvement of the technology by the local licensee, which then enters the original firm’s home market
D. All of the above are potential disadvantages to licensing.
Which option does NOT describe a common attribute of a fronting loan provided to an international subsidiary?
A. The lending bank is located in the subsidiary’s country.
B. The bank lends to the subsidiary firm an amount equal to the parent deposit at a slightly higher interest rate.
C. The parent makes a deposit equal to the size of the desired loan into a large commercial bank.
D. All of the above are typical characteristics of a fronting loan.
What are the essential attributes of owner-specific advantages in the OLI (Ownership, Location, Internalization) framework?
Is it true that a country can respond to the possibility of blocked funds by taking action before investing, during operations, or by investing in local assets that retain their value?
A. True
B. False
Determine the exchange rate in Brussels and the exchange rate in New York.
Your numbers will vary.
Determine the percentage change in the value of the peso and then comment on the peso’s fluctuations.
Your numbers will vary.
Analyze NexusTech Industries’ consolidated earnings after tax deductions from operations in the U.S., Brazil, Germany, and China. Calculate the consolidated earnings per share in U.S. dollars for NexusTech. Determine the proportional contribution to NexusTech’s consolidated earnings from each country, including the total proportion contributed by subsidiaries outside the United States.
Your numbers will vary.
Calculate NexusTech’s consolidated earnings and earnings per share in U.S. dollars after taxes across its operations in the U.S., Brazil, Germany, and China. Determine the total corporate income tax paid by NexusTech globally, assess the company’s effective tax rate, and analyze the potential impact on NexusTech’s EPS and effective tax rate if Germany were to reduce its corporate tax rate.
Your numbers will vary.
How can Embraer manage its currency exposure given a contract to produce and deliver four aircraft to a U.S. airline for $ million, while also needing to pay foreign suppliers $ million for inputs one year from now?
Your numbers will vary.