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Global Financial Environment | |
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Globalization and the Multinational Enterprise | |
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Globalization and Creating Value in the Multinational Enterprise | |
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The Theory of Comparative Advantage | |
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What Is Different about Global Financial Management? | |
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Market Imperfections: A Rationale for the Existence of the Multinational Firm | |
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The Globalization Process | |
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Summary Points | |
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Porsche Changes Tack | |
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Questions, Problems, Internet Exercises | |
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Financial Goals and Corporate Governance | |
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Who Owns the Business? | |
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What Is the Goal of Management? | |
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Corporate Governance | |
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Summary Points | |
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Governance Failure at Enron | |
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Questions, Problems, Internet Exercises | |
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The International Monetary System | |
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History of the International Monetary System | |
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Contemporary Currency Regimes | |
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Emerging Markets and Regime Choices | |
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The Birth of a European Currency: The Euro | |
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Exchange Rate Regimes: What Lies Ahead? | |
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Summary Points | |
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The Revaluation of the Chinese Yuan | |
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Questions, Problems, Internet Exercises | |
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The Balance of Payments | |
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Typical Balance of Payments Transactions | |
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Fundamentals of Balance of Payments Accounting | |
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The Accounts of the Balance of Payments | |
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The Capital and Financial Accounts | |
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The Balance of Payments in Total | |
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The Balance of Payments Interaction with Key Macroeconomic Variables | |
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Trade Balances and Exchange Rates | |
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Capital Mobility | |
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Summary Points | |
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Turkey's Kriz (A): Deteriorating Balance of Payments | |
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Questions, Problems, Internet Exercises | |
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Current Multinational Financial Challenges: The Credit Crisis of 2007-2009 | |
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The Seeds of Crisis: Subprime Debt | |
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The Transmission Mechanism: Securitization and Derivatives of Securitized Debt | |
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The Fallout: The Crisis of 2007 and 2008 | |
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The Remedy: Prescriptions for an Infected Global Financial Organism | |
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Summary Points | |
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Letting Go of Lehaman Brothers | |
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Questions, Problems, Internet Exercises | |
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Foreign Exchange Theory and Markets | |
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The Foreign Exchange Market | |
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Geographical Extent of the Foreign Exchange Market | |
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Functions of the Foreign Exchange Market | |
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Market Participants | |
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Transactions in the Interbank Market | |
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Foreign Exchange Rates and Quotations | |
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Summary Points | |
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The Venezuelan Bolivar Black Market | |
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Questions, Problems, Internet Exercises | |
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International Parity Conditions | |
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Prices and Exchange Rates | |
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Interest Rates and Exchange Rates | |
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Forward Rate as an Unbiased Predictor of the Future Spot Rate | |
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Prices, Interest Rates, and Exchange Rates in Equilibrium | |
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Summary Points | |
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Currency Pass-Through at Porsche | |
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Questions, Problems, Internet Exercises | |
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An Algebraic Primer to International Parity Conditions | |
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Foreign Currency Derivatives | |
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Foreign Currency Futures | |
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Currency Options | |
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Foreign Currency Speculation | |
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Option Pricing and Valuation | |
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Currency Option Pricing Sensitivity | |
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Prudence in Practice | |
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Summary Points | |
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Warren Buffett's Love-Hate Relationship with Derivatives | |
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Questions, Problems, Internet Exercises | |
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Currency Option Pricing Theory | |
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Interest Rate and Currency Swaps | |
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Defining Interest Rate Risk | |
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Management of Interest Rate Risk | |
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Trident Corporation: Swapping to Fixed Rates | |
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Currency Swaps | |
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Trident Corporation: Swapping Floating Dollars into Fixed Rate Swiss Francs | |
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Counterparty Risk | |
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Summary Points | |
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McDonald's Corporation's British Pound Exposure | |
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Questions, Problems, Internet Exercises | |
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Foreign Exchange Rate Determination and Forecasting | |
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Exchange Rate Determination: The Theoretical Thread | |
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The Asset Market Approach to Forecasting | |
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Disequilibrium: Exchange Rates in Emerging Markets | |
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Illustrative Case: The Asian Crisis | |
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Illustrative Case: The Argentine Crisis of 2002 | |
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Forecasting in Practice | |
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Summary Points | |
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JPMorgan Chase's Forecasting Accuracy | |
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Questions, Problems, Internet Exercises | |
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Foreign Exchange Exposure | |
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Transaction Exposure | |
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Types of Foreign Exchange Exposure | |
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Why Hedge? | |
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Measurement of Transaction Exposure | |
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Trident's Transaction Exposure | |
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Management of an Account Payable | |
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Risk Management in Practice | |
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Summary Points | |
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Xian-Janssen Pharmaceutical (China) and the Euro | |
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Questions, Problems, Internet Exercises | |
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Complex Options | |
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Operating Exposure | |
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Attributes of Operating Exposure | |
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Illustrating Operating Exposure: Trident | |
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Strategic Management of Operating Exposure | |
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Proactive Management of Operating Exposure | |
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Contractual Approaches: Hedging the Unhedgeable | |
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Summary Points | |
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Toyota's European Operating Exposure | |
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Questions, Problems, Internet Exercises | |
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Translation Exposure | |
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Overview of Translation | |
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Translation Methods | |
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Translation Example: Trident Europe | |
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Comparing Translation Exposure with Operating Exposure | |
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Managing Translation Exposure | |
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Summary Points | |
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LaJolla Engineering Services | |
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Questions, Problems, Internet Exercises | |
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Financing the Global Firm | |
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The Global Cost and Availability of Captial | |
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Weighted Average Cost of Capital | |
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The Demand for Foreign Securities: The Role of International Portfolio Investors | |
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The Cost of Capital for MNEs Compared to Domestic Firms | |
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Solving a Riddle: Is the Weighted Average Cost of Capital for MNEs Really Higher Than for Their Domestic Counterparts? | |
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Summary Points | |
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Novo Industri A/S (Novo) | |
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Questions, Problems, Internet Exercises | |
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Sourcing Equity Globally | |
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Designing a Strategy to Source Equity Globally | |
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Foreign Equity Listing and Issuance | |
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Effect of Cross-Listing and Equity Issuance on Share Price | |
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Barriers to Cross-Listing and Selling Equity Abroad | |
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Alternative Instruments to Source Equity in Global Markets | |
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Summary Points | |
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Petrobr�s of Brazil and the Cost of Capital | |
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Questions, Problems, Internet Exercises | |
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Sourcing Debt Globally | |
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Optimal Financial Structure | |
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Optimal Financial Structure and the MNE | |
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Financial Structure of Foreign Subsidiaries | |
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International Debt Markets | |
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Summary Points | |
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Tirstrup BioMechanics (Denmark): Raising Dollar Debt | |
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Questions, Problems, Internet Exercises | |
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Foreign Investment Decisions | |
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International Portfolio Theory and Diversification | |
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International Diversification and Risk | |
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Internationalizing the Domestic Portfolio | |
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National Markets and Asset Performance | |
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Summary Points | |
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Is Modern Portfolio Theory Outdated? | |
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Questions, Problems, Internet Exercises | |
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Foreign Direct Investment Theory and Political Risk | |
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Sustaining and Transferring Competitive Advantage | |
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The OLI Paradigm and Internalization | |
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Deciding Where to Invest | |
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How to Invest Abroad: Modes of Foreign Involvement | |
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Foreign Direct Investment Originating in Developing Countries | |
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Foreign Direct Investment and Political Risk | |
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Assessing Political Risk | |
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Firm-Specific Risks | |
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Country-Specific Risks: Transfer Risk | |
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Country-Specific Risks: Cultural and Institutional Risks | |
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Global-Specific Risks | |
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Summary Points | |
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Mattel's Chinese Sourcing Crisis of 2007 | |
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Questions, Problems, Internet Exercises | |
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Multinational Capital Budgeting | |
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Complexities of Budgeting for a Foreign Project | |
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Project versus Parent Valuation | |
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Illustrative Case: Cemex Enters Indonesia | |
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Real Option Analysis | |
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Project Financing | |
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Summary Points | |
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Trident's Chinese Market Entry-An Application of Real Option Analysis | |
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Questions, Problems, Internet Exercises | |
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Managing Multinational Operations | |
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Multinational Tax Management | |
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Tax Principles | |
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Transfer Pricing | |
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Tax Management at Trident | |
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Tax Haven Subsidiaries and International Offshore Financial Centers | |
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Summary Points | |
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Stanley Works and Corporate Inversion | |
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Questions, Problems, Internet Exercises | |
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Working Capital Management | |
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Trident Brazil's Operating Cycle | |
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Trident's Repositioning Decisions | |
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Constraints on Respositioning Funds | |
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Conduits for Moving Funds by Unbundling Them | |
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International Dividend Remittances | |
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Net Working Capital | |
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International Cash Management | |
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Financing Working Capital | |
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Summary Points | |
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Honeywell and Pakistan International Airways | |
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Questions, Problems, Internet Exercises | |
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International Trade Finance | |
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The Trade Relationship | |
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The Trade Dilemma | |
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Benefits of the System | |
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Letter of Credit (L/C) | |
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Draft | |
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Bill of Lading (B/L) | |
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Example: Documentation in a Typical Trade Transaction | |
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Government Programs to Help Finance Exports | |
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Trade Financing Alternatives | |
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Forfaiting: Medium- and Long-Term Financing | |
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Summary Points | |
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Crosswell International's Precious Ultra-Thin Diapers | |
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Questions, Problems, Internet Exercises | |
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Answers to Selected Problems | |
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Glossary | |
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Index | |
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Credits | |