Overview

If you are choosing this module as an option, please note that it is a finance module and will incorporate quantitative decision making. The financial management of multinational companies (MNCs). The impact of macroeconomic, fiscal, currency and political environments on MNCs. Determinants of exchange rates, and purchasing power and interest rate parity. Management of exchange rate exposure through forwards, options and money market contracts. Corporate financing decisions including sourcing funds from overseas and identifying costs of capital; capital investment appraisal; working capital management and the positioning of funds in the MNC.

The financial management of multinational companies (MNCs). The impact of macroeconomic, fiscal, currency and political environments on MNCs. Determinants of exchange rates, and purchasing power and interest rate parity. Management of exchange rate exposure through forwards, options and money market contracts. Corporate financing decisions including sourcing funds from overseas and identifying costs of capital; capital investment appraisal; working capital management and the positioning of funds in the MNC.

Assessment Strategy

-threshold C --A basic knowledge of course material. -good -B - In addition to the above, an ability to write analytically on specific issues. -excellent -A - In addition to the above, the ability to illustrate and enhance arguments and analyses through the use of relevant supporting evidence drawn from the established literature and real-life examples.

Learning Outcomes

• Analyse the factors that influence the evaluation and implementation of international investment projects.

• Assess how to raise capital, globally, and evaluate firms' costs of the capital.

• Assess the impact of purchasing parity relationships linking exchange rates, interest rates and inflation rates.

• Critique modes of foreign direct investment and the political risks which accompany such investment.

• Evaluate operating, transaction and translation exchange rate exposures and their management through strategy and the use of forward markets, money markets and options.