COMM 4201

This course aims at acquainting students with international aspects of corporate finance. The ultimate objective of the course is to develop your ability to understand and analyze major problems of financial management in an international context. Specifically, we will see throughout this course, how the business of the multinational corporation (MNC) - compared to that of a purely domestic firm - is affected by the changes in the international financial environment and by the presence of new variables, in particular the exchange rate risk and the political risk. Therefore, the first part of the course will provide an overview of the MNC and the international environment in which it operates and describe the functioning of the international financial markets with emphasis on the Foreign Exchange Market. We will also thoroughly examine the theories underlying exchange rate determination, as well as exchange rate risk measurement and management. Finally, we will analyze how exchange rate risk affects the pricing of capital assets.