Question: Using a specific firm as a concrete example, how can the following affect the capital budgeting decisions of the multinational company you selected? Exchange rate
Using a specific firm as a concrete example, how can the following affect the capital budgeting decisions of the multinational company you selected?
Exchange rate risk
Political risk
Tax law differences
Transfer pricing
A strategic rather than a strict financial viewpoint
For the firm you selected, consider the following:
Which of the above would be the most important consideration? Why?
How might these ideas differ if the firm you chose were part of a different industry?
How might these your ideas change with a small business seeking to engage in multinational commerce?
What specific capital budgeting factors would discourage a firm from entering multinational commerce? Why? Provide a concrete example.
Cite sources.
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