Solution-Explain the dominance of american banks

Explain the dominance of american banks

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1. Suppose you own shares in a company. The current price per share is $25. Another company has just announced that it wants to buy your company and will pay $35 per share to acquire all the outstanding shares. Your company's management immediately begin fighting off this hostile bid. Is management acting in the shareholders' best interest? Why or why not?

2. You and a friend are an advisor to a growing corporation with some employees. Your friend suggests that to eliminate the principle-agent problem, all employees must also be granted stock. Do you agree or disagree with this advice? Explain

3. According to an article in Forbes, "American companies can and are raising capital in Japan at relatively low rates of interest. Dow Chemical, for instance, has raised $500 million in yen. That cost the company over 50 percent less than it would have at home." Comment on this statement.

4. Even though the US economy is only about 15% of global GDP, US banks earn 60-70% of global banking fees. Give three reasons to explain the dominance of American banks.

Reference no: EM133120473

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Explain the dominance of american banks

Reference no: EM133120473

Reference no: EM133120473

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