Chapter 17, Problem 11MC

Summary Introduction

Case summary:

P Inc.’s CEO person M is considering expanding the geographic footprint of its line of dried and smoked low-fat opossum, ostrich, and venison jerky snack packs. Europeans may not be as accepting of opossum jerky as initial research suggests, so the expansion will proceed in steps. P Inc.’s CFO, person K, although enthusiastic about the plan, is nonetheless concerned about how an international expansion and the additional risk that entails will affect the firm’s financial management process. Manger recognizes that the expansion carries some risk. The tutorial will be presented at the next board of directors meeting.

To discuss: The extent do average capital structures vary across different countries.