Exam (elaborations)
D080 Module - fully solved & updated(graded A+).
- Course
- Institution
D080 Module - fully solved & updated(graded A+).
[Show more]
Content preview
D080 Module #11 2025-2026 fullysolved & updated(graded A+)
Types of Funding for Large International Businesses - answer a)
cash
b) loans
c) bonds: debt securities investors can purchase, which will mature
over time. The rate of return and time to maturity can vary. These
are also lower costs of capital as they are paid out before equity in
the case of a bankruptcy
d) equity (stocks): Issuing shares (stocks) is another funding source,
particularly for larger and publicly traded organizations. By issuing
equity, organizations can sell small fractions of organizational
ownership as an asset for investors, who are betting on the
organization's success. These are riskier, most costly, and less
reliable sources of income compared to deb
Debt - answer - Amount owed to someone
Equity - answer - Value of the shares of a company
Equity Financing - answer - raising capital by selling shares of
stock
Global Equity Market - answer - refers to all stock exchanges
worldwide where firms can buy and sell stock for financing an
investment
,- The advantage of raising capital in equity markets is that the firm
does not have to repay the money at a specific time or at a specific
interest rate, as it does with bank loans or bonds.
- The disadvantage is that each time a firm offers stock, the firm's
management loses some control of the company because
shareholders can vote to approve or disallow management actions
Multinational firms choose to raise money in foreign markets for a
number of reasons - answer - For example, French luxury beauty
products company L'Occitane® conducted its initial public offering
(IPO) on Hong Kong's stock exchange, rather than on the stock
exchange in its home country—the NYSE Euronext in Paris.
- L'Occitane® made this decision because emerging market
consumers are its fastest growing segment. Listing on Hong Kong's
exchange makes the company more visible in these growing
markets and lets locals participate in the growth of the firm by
buying shares
Some multinational firms raise money in both their home-country
and overseas stock exchanges - answer - one of the reasons for
listing on multiple exchanges is a lower cost of capital as shares
become available to global investors who might not otherwise be
able to purchase shares due to international investment barriers
Debt Financing - answer - refers to raising capital by borrowing the
money and agreeing to repay the entire amount plus agreed-on
interest at a specific date in the future.
- Firms can borrow money from banks or by selling bonds
- The advantage of raising money through debt financing is that
company management does not give up any ownership of the firm
, Multinational firms can issue bonds in overseas markets as well as
in their home countries - answer - McDonald's was the first foreign
company to issue yuan-denominated bonds, selling 200 million yuan
(or $29 million) of 3 percent notes due in September 2013.
- As Donald Straszheim, senior managing director and head of China
research at the International Strategy & Investment Group,
observed, "There are hundreds of global companies wanting to do
more business in China, and they will want to be involved in the
country's evolving credit market
Types of Funding for Small International Businesses - answer a)
Venture capital (VC)
b) Angel investor
c) Friends, family or fools (FFF)
d) Crowdsourcing
Venture Capital (VC) - answer - A type of high-risk investing
- . Venture capitalists (VCs) accumulate capital from a number of
speculative investors and seek strong business opportunities still in
the start-up phase.
- Winning capital from a VC can be quite lucrative, as the amount of
capital invested can be high (high enough to justify international
operations).
- VCs would generally be represented by a board that would assess
the viability of the business as an investment and determine terms
(ownership by investors) and returns
Crowdsourcing - answer - Enlisting the help of a large number of
people, often via the internet
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller BRAINBOOSTERS. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $13.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
77254 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now