Fundamentals of Corporate Finance Alternate Edition
Fundamentals of Corporate Finance Alternate Edition
10th Edition
ISBN: 9780077479459
Author: Stephen A. Ross, Randolph W. Westerfield, Bradford D. Jordan
Publisher: MCGRAW-HILL HIGHER EDUCATION
Question
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Chapter 21, Problem 1M
Summary Introduction

Case synopsis:

Person MS and Person TS are the owners of Company SS and they were discussing with the light aircraft dealer in Country M about selling their planes in Continent E. Person JJ, the dealer wishes to add the Company SS to his present retail lines.

Characters in the case:

  • Person MS
  • Person TS
  • Person JJ
  • Continent E
  • Country M
  • Company SS
  • Person CG

Adequate information:

  • Person TS and Person MS are confident that the company can manage the additional volume with their current facilities.
  • Person TS and Person MS are unsure about their potential financial risk in selling their planes in Continent E.
  • Person MS and Person TS decide to ask their financial analyst Person CG to prepare a study on the proposed multinational sales.

To determine: The pros and cons of the multinational sales and the additional risk that the company might face.

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