International capital budgeting, Accounting Basics

International Capital Budgeting

Question

1. How does international capital budgeting differ from domestic capital budgeting? Many firms, when assessing international projects, apply a premium to required returns to get an adjusted discount rate that reflects the international risk. Explain by using arguments from the CAPM why this is a poor approach for risk adjustments.

2. Assume that I do not want to spend the time and money to monitor the current owner's expenses. I suggest a deal wherein I get 25% of the gross rather than 50% of the net. Since the net margin is 50%, I argue that my expected return hasn't changed, so the purchase price should be the same as in 1).

a. Is this true? Why or why not?

Posted Date: 2/16/2013 2:26:58 AM | Location : United States







Related Discussions:- International capital budgeting, Assignment Help, Ask Question on International capital budgeting, Get Answer, Expert's Help, International capital budgeting Discussions

Write discussion on International capital budgeting
Your posts are moderated
Related Questions
Flying High Inc. plans to raise $5,000,000 external financing through issuing bonds, and is considering two options: regular bonds and zero couple bonds.  The regular bonds will ha

Q. What do you mean by Risk management contracts? In the normal course of business the Company utilizes a variety of off-balance-sheet financial instruments to manage its expos

Q. Illustrate the Financial accounting process? In this section we describe the accounting equation as the framework for the entire accounting process. Then we demonstrate you

Q. Describe the methods of recording? Two general deductions from gross sales are (a) sales discounts and (b) sales returns and allowances. Sellers trace these deductions in co

On october 5 2011 mara hotel collectedmthe amount of 180000 repreesenting advanced rental from a tenant who occupies space of the building. tHe advanced rental willcover the period

How to do a trial Balance                     Particulars                            Amount Dr.                       Amount Cr. In

Q. Why we need book value? Book value -- total assets minus total liabilities. Book value also meansvalue of an asset as recorded on the company's financial reports or books. B

For my accounting class, how would I journalize the adjusting entry for Annual depreciation is $3,480 on the building with the building amounting to $76,000 on the trial balance fo

Accounting process in operation Micro Train Corporation is a small corporation that provides on-site personal computer software training using the clients' equipment. The compa

Q. Describe the Cost of sales? Cost of sales, cost of goods sold -- expense or cost of all items sold during an accountingperiod. Every unit sold has a cost of sales or cost of