Analyzing a Multinational Corporation: Assignment Details and Requirements

Part 1: Requirements

1 PART 1 (due in week 6) is worth 15% of your overall individual grade. For Part 1 you will deliver a minimum of A4 page paper.

2 PART 2 (due in week 12) is worth 20% of your overall individual grade. For Part 2 you will deliver a minimum of A10 page paper.

At the start of the course students will be assigned two companies,either Canadian or USA corporations.One company you will be required to run and the other you will be required to monitor its stock prices.

• Include at least two references other than in addition to your textbook.Cite references in text and create a reference list at the end each document under the heading References.Follow APA 7 format.
• Please review the Rubric for each part of the assignment on eCentennial to maximize your grade.
• To submit your file, rename it as follows: Group#_Assignment#-INTL-303. Upload the document to the assignment drop box.
• Submit each report through Turnitin with a maximum similarity of 20% (files not submitted through Turnitin will earn a zero grade).
• A late penalty of 10% per day will be levied on late submissions.
• A template is located in the course document menu.

• This project allows you to learn more about international investing and about firms that compete in the global arena.
• You will be assigned a Canadian or USA company to run.The focus is to extend the company’s product line.You are required to identify an international supplier to purchase a product or raw material to meet this goal.
• You will also be assigned a USA or Canadian multinational corporatio,for which you are required to monitor the company’s stock.
• You will be required to do the following:

1 Evaluate the financial need of your MNC and choose the most cost-effective way to finance your purchase.

2 Examine the existing markets and evaluate the strengths and weakness of your MNC.

3 Analyze the risk of entering a foreign market.

4 Conduct a research and review the performance of your MNC,the corporation stock being monitored over the last 2 years and monitor the stock for the last 12 months.

5 Explain the performance of the corporation and why it performs well or poorly relative to the overall market index.

6 Research and explanations should provide some insight into what is driving the valuation of a corporation over time and how the MNC protects its value.

Multinational Corporations (MNC) are defined as firms that engage in some form of international business.Their managers conduct international financial management which involves international investing and financing decisions that are intended to maximize the value of the MNC.The goal of these managers is to maximize their firm’s value.The MNC objectives are to identify new markets to increase market share,invest excess cash,and ensure the soundness of any host country's financial market.As the CFO you are asked to analyze the strengths and risk of a potential new market and prepare a report to present to the Board.You will be given 8 questions to answer,and each question will represent a heading in your documents.

PART 1: Answer the first four questions.Each group member should respond to one question and put their name next to the response they provided.One person in the group will put all answers together following APA format,using each question as a heading,and submit only one file.

PART 2: Answer questions 5 through 8 as a group.Create a full document and include the following:an introduction,nalysis(thorough answers to the questions with supporting evidence),conclusion,and references.You can decide as a group,how to divide the work for the introduction,conclusion,and references,and who will put the report together for delivery.Remember that only ONE file should be submitted for the group.

1 Host Country Central Bank Analysis.Examine the Central Bank of the host country and advise your Board. Does the host country have a strong financial market?

A What are the responsibilities of the central bank for regulatory control with focus on the commercial and investment banking systems?

B What measures are in place to protect clients in the event a bank fails in the host country?

C Most of the country’s government debts are held in which instruments?

D Visit the host country’s Central bank’s website, examine the movement of inflation rates and interest rates, and discuss the changes in both rates. In addition,prepare the following documents to include with the Part 2 Report:

• The letter of credit your bank would send to your supplier’s bank

Your idea should be simplified to the degree that you could possibly implement it someday. Your idea should focus on one country and one foreign currency since many companies are focused on one manner when they are first created.So that you can recognize the issues regarding exchange rate risk that are discussed throughout this text,you should assume that you will need to pay foreign currency when purchasing your product or raw materials.Your idea should be for a small company instead of a large company because many large companies started as small companies.The following questions will help you define your company’s idea:

• What product/raw material will you purchase?
• Which foreign country do you plan to target?
• What is the level of risk associated with the country?
• How long will it take for the product to reach Canada?
• Can the product enter Canada?Will it attract import duties? Is there a free trade agreement between Canada and your proposed country?
• How will you mitigate against foreign exchange risk?
• What are your contingency plans?