General description
The first part of this module aims at highlighting the position of international finance in Finance and the establishment of Multinational Companies (MNCs) and the theories that explain their emergence with special emphasis on their specialties in comparison to national companies. Then, it explores the Foreign Exchange (FX) market, pricing methods, and FX theories. Next, it discusses different types of FX exposures that face MNCs and hedging methods. In addition, it provides detailed explanations of different entry methods to new markets including Foreign Direct Investment (FDI) and differentiates it from investing in international portfolio. In its second part, it illustrates different financing sources of MNCs and discusses their capital structure and methods of computing the cost of capital. Then, it discusses methods of evaluation of MNCs projects using traditional as well as real options and shows how to consider their risk.