国际财务管理(英文版)课后习题答案(整合版).doc

国际财务管理(英文版)课后习题答案(整合版) CHAPTER 1 GLOBALIZATION AND THE MULTINATIONAL FIRM SUGGESTED ANSWERS TO END-OF-CHAPTER QUESTIONS QUESTIONS 1. Why is it important to study international financial management? Answer: We are now living in a world where all the major economic functions, i.e., consumption, production, and investment, are highly globalizedIt is thus essential for financial managers to fully understand vital international dimensions of financial managementThis global shift is in marked contrast to a situation that existed when the authors of this book were learning finance some twenty years agoAt that time, most professors customarily and safely, to some extent ignored international aspects of financeThis mode of operation has become untenable since then. How is international financial management different from domestic financial management? Answer: There are three major dimensions that set apart international finance from domestic finance. They are: 1foreign exchange and political risks, 2market imperfections, and 3expanded opportunity set. 3. Discuss the three major trends that have prevailed in international business during the last two decades. Answer: The 1980s brought a rapid integration of international capital and financial markets. Impetus for globalized financial markets initially came from the governments of major countries that had begun to deregulate their foreign exchange and capital marketsThe economic integration and globalization that began in the eighties is picking up speed in the 1990s via privatizationPrivatization is the process by which a country divests itself of the ownership and operation of a business venture by turning it over to the free market system. Lastly, trade liberalization and economic integration continued to proceed at both the regional and global levels. 4How is a country’s economic well-being enhanced through free international trade in goods and services? Answer: According to David Ricardo, wit