Question One

a) Globalization has resulted in many organizations engaging in corporate alliances and establishment of trading blocks. Further, development in information technology and the advent of e-commerce has enabled companies to greatly expand their markets.

Required:

Identify five (5) factors that complicate financial management in multinational firms.

b)Explain each of the following foreign exchange regimes:

I. Fixed exchange rates

ii. Pegged exchange rates

iii) Floating exchange rates

iv) Freely floating exchange rates