FIN241 Lecture Notes - Lecture 1: Corporate Finance, Allocative Efficiency, Unbridled
Document Summary
Regulatory and political regimes e. g. tax rules, corporate governance. International finance deals with the financial managements of business corporations with international financial flows (goods and service transfer requiring financial transactions). Many complications arise from needing to exchange currencies. Most exchange rates are floating and it is almost impossible to predict the rate in the future creating uncertainty. Financial managers need to understand the effects of international events on a firm and able to effective guard against unfavourable events or take advantage of favourable ones. This requires a good grasp if the factors affecting exchange rates, the workings of international financial markets and the issues involved in global financial management: Business corporations that operate in several nations face two key challenges: the need to deal with currencies with unpredictable movements of exchange rates leading to foreign exchange rate exposures, to cope with different business environments: 1. 1 globalisation and the growth of international trade and capital flows.
