International Finance Essay

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True/False
____T__ 1. Multinational financial management requires that financial analysts consider the effects of changing currency values.

__F__ 2.
Legal and economic differences among countries, although important, do NOT pose significant problems for most multinational corporations when they coordinate and control worldwide operations and subsidiaries.
Comment: Legal and economic differences among countries do affect the worldwide operations and subsidiaries.

___T_ 3.
When the value of the U.S. dollar appreciates against another country's currency, we may purchase more of the foreign currency with a dollar.
__T__ 4.
The United States and most other major industrialized nations currently operate under a system of floating …show more content…
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|e. |Cultural differences need not be accounted for when considering firm goals and employee management. |

__a__ 20.
If the inflation rate in the United States is greater than the inflation rate in Britain, other things held constant, the British pound will
|a. |Appreciate against the U.S. dollar. |
|b. |Depreciate against the U.S. dollar. |
|c. |Remain unchanged against the U.S. dollar. |
|d. |Appreciate against other major currencies. |
|e. |Appreciate against the dollar and other major currencies. |

___a_ 21.
In Japan, 90-day securities have a 4% annualized return and 180-day securities have a 5% annualized return. In the United States, 90-day securities have a 4% annualized return and 180-day securities have an annualized return of 4.5%. All securities are of equal risk, and Japanese securities are denominated in terms of the Japanese yen.

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