EECS 1019 Lecture 30: EECS 1019 Lecture 30 Notes
15 Jun 2018
School
Course
Professor
EECS 1019 Lecture 30 Notes
Introduction
Exposure to International Economic Conditions
• The cash inflows that an MNC receives from sales in a foreign country during a given
period depeds o the dead that outr’s osuers for the MNC’s produts,
whih i tur is affeted that outr’s atioal ioe i that period.
• If economic conditions improve in that country, consumers there may enjoy an increase
in their income and the employment rate may rise.
• In that case, those consumers will have more money to spend and their demand for the
MNC’s produts will irease.
• This illustrates how the MNC’s ash flows ireasig eause of its eposure to
international economic conditions.
• However, an MNC can also be adversely affected by its exposure to international
economic conditions.
• If conditions weaken in the foreign country where the MNC does business, that
outr’s osuers suffer a derease i their ioe ad the eploet rate a
decline.
• Then those consumers have less money to spend, and their dead for the MNC’s
products will decrease.
• I this ase, the MNC’s ash flows are redued eause of its eposure to iteratioal
economic conditions.
• When Facebook went public in 2012, the registration statement acknowledged its
exposure to international economic conditions
• We plan to continue expanding our operations abroad where we have limited operating
experience and may be subject to increasing business and economic risks that could
affect our financial results.
• International economic conditios a also affet the MNC’s ash flows idiretl
affetig the MNC’s hoe eoo.
find more resources at oneclass.com
find more resources at oneclass.com
8
EECS 1019 Full Course Notes
Verified Note
8 documents
