Exam 2 Coursework Example | Topics and Well Written Essays - 500 words

Exam 2 - Coursework Example A targets previous cash flows are typically an accurate indicator of future cash flows, especially when the targets cash flows would have to be converted into the acquirers home currency as they are remitted to the parent. An international acquisition may be preferable to the establishment of a new subsidiary because the firm can immediately expand its international business and benefit from existing customer relationships. Assume a U.S. firm initiates direct foreign investment in the U.K. If the British pound is expected to appreciate against the dollar, the dollar value of earnings remitted to the parent should ____. The parent may request that the subsidiary ____ in order to benefit from the expectation about the pound. Consider Firm A and Firm B that both produce the same product. Firm A would more likely have more stable cash flows if its percentage of foreign sales were ____ and the number of foreign countries it sold products to was