跨国公司财务管理基础第5版1-8章习题答案

CHAPTER1SUGGESTEDANSWERSTO“GENERALELECTRICGLOBALIZES”1.WhatadvantagesdoesGeneralElectricseektoattainfromitsinternationalbusinessactivities?ANSWER.Asidefromgainingaccesstomarketsworldwide,GEfocusesontakingadvantageofitsglobalreachtofindlessexpensivematerialsabroadandintellectualcapital,therebyloweringitscostofdesigningandmanufacturingproducts.2.Whatactionsisittakingtogaintheseadvantagesfromitsinternationalactivities?ANSWER.GEisacquiringcompaniesabroad,andsettingupjointventureswithotherforeigncompanies,togaintheirassetsandabilitytoservicelocalcustomers.Itissettingupmanufacturingfacilitiesabroadtoaccesslowercostlaborandmaterialsandalsosourcingmorepurchasesabroadforthesamereasons.ItalsoisidentifyingandhiringengineeringandscientifictalentfromaroundtheworldtoboostitsintellectualcapitalandissettingupR&Dfacilitieswherethistalentcanwork.3.WhatrisksdoesGEfaceinitsforeignoperations?ANSWER.Potentialincreasedrisksfromglobaloperationsinclude,amongotherthings,currencyrisks,higherreceivablesdelinquenciesandbaddebts,delaysorcancellationofsalesandorders,higherlocalcurrencyfinancingcosts,andaslowdowninestablishedfinancialservicesactivities.4.WhatprofitopportunitiesforGEcanariseoutoftheserisks?ANSWER.NewprofitopportunitiesforGEinclude,amongotherthings,lowercostsofgoodssourcedfromcountrieswithweakenedcurrencies,moreopportunitiesforlowercostoutsourcing,expansionofindustrialandfinancialservicesactivitiesthroughpurchasesofcompaniesorassetsatreducedpricesandlowerU.S.debtfinancingcosts.SUGGESTEDANSWERSTO“DEMOCRATSTURNPROTECTIONIST”1.Whatmightexplainthecandidates’andDemocraticParty’sreversalofpositiononfreetrade?Whichvotingconstituencieswouldbemostlikelytorejectfreetrade?Why?ANSWER.TheDemocraticPartyisheavilyreliantonunionvotesandmoney.Andunions,particularlytheindustrialunionsthatmakeupthecoreoftheunionmovementisagainstfreetradebecauseitsubjectstheirmemberstocompetitionfromforeignlaborembodiedinforeigngoodsandservices.ThecandidatesthemselvesaretryingtoappealtotheunionsastheyareamongthebestorganizedsegmentoftheDemocraticPartyandhavetheabilitytoturnoutvotesinprimarieswherefewvotersgotothepolls.Giventhelowturnout,aprimaryisoftendeterminedbythemostcommittedvoters,whoareoftenunionmembersthreatenedwithjoblossesfromfreetrade.2.WhatleveragedothetradeunionshaveinpersuadingAlGoreandotherDemocraticcandidatestopayattentiontotheiranti-free-tradeposition?Explainwhytheseparticularunionsmightbeparticularlypowerful.ANSWER.Theunions’leveragestemsfromthefactthattheirmembershipisconcentratedinsixlargeindustrialstatesthatarecrucialswingstatesinpresidentialelections.AlGoreneedsthesestateswiththeirlargevotetotalstowinanationalelection.Thereareenoughindustrialunionmembersinthesesixstatesthattheycouldtipacloserace.IftheunionmembershipweredispersedthroughouttheUnitedStates,theirleveragewouldbegreatlydiminishedsincetheycouldn’tconcentratetheirvotestodeliverkeystates.3.Whattrade-offsdoAlGoreandotherDemocratsfaceinaccommodatinglabor?Explain.ANSWER.IfAlGoregivesintoprotectionistsentimenttoaccommodatetheseindustrialunions,heriskslosingstateslikeCalifornia(SiliconValley),Washington(Boeing),NewYork(WallStreet),andNewJersey(pharmaceuticalfirms)thatdependonforeigntradefortheirlivelihood.Forexample,GorehasmadeaparticularpushtogainmoneyandvotesfromSiliconValley,whichishighlydependentonexports.PushingprotectionistpoliciescouldleadtoabacklashagainstGorefromSiliconValleyexecutiveswhounderstandthatforeigncountrieswouldlikelyretaliateagainstU.S.products.Moreover,aprotectioniststancecouldcostGorefarmstatevotesaswellbecausefarmersarehighlydependentonexports.Gorealsohastobeconcernedthathewilllosethevotesofmiddle-of-the-roadDemocratsandindependentsifheisviewed–asWalterMondalewas–asatooloflabor.4.HowcanU.S.manufacturerscompetewithforeignproducers?Aretheydoomed,assuggestedbythepresidentoftheUnitedSteelworkersofAmerica?.Explain.ANSWER.TheobjectiveevidenceshowsthatU.S.manufacturerscancompeteagainstforeignproducers,althoughnotacrosstheboard.Rather,U.S.firmshaveacomparativeadvantageinanumberofhightechnologyindustriesandindustrieswhereclosecoordinationbetweencustomerandproduceriskey(suchasfashiondesign).Infact,U.S.industrialoutputisupbutthenumberofmanufacturingjobshasnotrisen;it’sjustthathigherproductivitymeansthatcompaniesdon’thavetohireasmanynewworkerstoproducethehigheroutput.U.S.companiesalsohaveacomparativeadvantageinmanyserviceindustries,suchasfinancialservices,consulting,andtelecommunications.5.Aretheunionsandtheirmembersrighttobeconcernedabouttheeffectsoffree-tradepolicies?Whataretheseeffectsthattheyareconcernedabout?Whowouldbehelpedandwhowouldbehurtiftheunionsgottheirwayontrade?Explain.ANSWER.Yes.Theindustrialunionshavesetwagesandbenefitswellabovemarketlevels.Theywereabletogetawaywithsuchhighlevelsofcompensationaslongastheywerenotfacingcompetitionfromlower-paidforeignworkerswhoselaborisembodiedinimportedproducts.Lower-pricedforeignimportswillputpressureoncompetingU.S.goodsand,therefore,onthecompensationenjoyedbyindustrialunionmembers.Thus,protectionistpolicieswillprotectthewage