Discussion Post: Discuss International Financial Management
Initiate a discussion on the theory of comparative advantage and how you see it as important for a multinational business. Explain what you feel are the three most important reasons for why firms become multinational firms, and identify companies that either do take advantages of those reasons or likely could take advantage of those reasons for becoming a multinational firm. Order these three reasons from most important to least important, and defend your choices and this ordering.
Homework: Analyze the International Monetary System
Write a paper about the International Monetary System that addresses each of the following issues:
1. Define the International Monetary System and outline the history of the system.
2. Describe and provide examples of what is meant by "currency regimes," and define selected types of regimes and form an argument for selecting fixed exchange rate and arguments for selecting flexible exchange rates.
3. Describe and define the creation of the Euro and discuss the benefits as well as the problems associated with the creation of this currency.
Length: 5 to 7 pages.
The Global Environment
Explore the forces that motivate the creation of multinational businesses and the financial environment that has existing to support these global business initiatives. The creation of multinational businesses begins with the theory of comparative advantage. The theory argues that each country will have resources that allow it to have a competitive advantage in the production of certain goods. In turn, the country will use that production to trade for other goods that it wishes to consume but may not have a competitive advantage in producing.
The multinational firm takes that same collection of resources from countries and manages them in an efficient manner to produce those goods in which the country holds that competitive advantage. However, in order for these goods to be exchanged across countries, the multinational business relies upon a stable financial environment that allows for the exchange of currencies. The international monetary system is comprised of a collection of currencies with a variety of arrangements by country for how their currency moves with other currencies. These important financial structures have critical implications for multinational businesses.
• Review the resources listed in the Books and Resources area below to prepare for this homework.
• Complete the following Spotlight on Skills if you need assistance with the tools used to complete your homework.
Format your homework according to the give formatting requirements:
1. The answer must be double spaced, typed, using Times New Roman font (size 12), with one-inch margins on all sides.
2. The response also includes a cover page containing the title of the homework, the course title, the student's name, and the date. The cover page is not included in the required page length.
3. Also include a reference page. The references and Citations should follow APA format. The reference page is not included in the required page length.
Attachment:- The-Global-Companys-Challenge.rar