International Financial Management

International Financial Management Full Time 2005 MBA

 

SUMMATIVE ASSIGNMENT

 

 

Assume that you are employed by Vertex-Speed Ltd, a fast growing car

manufacturer based in County Durham, UK. Vertex-Speed has been exporting

“Vertex-Gamma”, a prestigious executive car, to Malaysia and Brazil for the last 10

years. The company is considering establishing a subsidiary to produce similar

quality cars either in Malaysia or in Brazil. The subsidiary is expected to sell its

products in the host country as well as in the neighboring countries of the host. The

Managing Director of Vertex-Speed is aware that you have recently completed an

MBA from Durham Business School with an in-depth knowledge in international

financial management. Therefore, she approaches you for your advice. You are

required to prepare a report comparing the risk factors that Vertex-Speed may

encounter in these countries and suggest the best alternative. In your report you

should also include the measures that Vertex-Speed should take in managing the

risk associated with the suggested host country.

 

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Performance in the summative assessment for this module is judged against the following

criteria:

 

· Relevance to question

· Structure/presentation & clarity of writing

· Scope & relevance of literature review

· Rigor of argument

· Evidence of understanding

· Conclusions/Recommendations

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Approximate  context?

 

Introduction

Automobile industry

Risk assessment in Brazil

Risk assessment in Malaysia

Conclusion and Recommendations

 

We have to analyze the systematic risk of the country, country risk and financial risk, and also see if the region has some risk or not, all these should be taken into account.

 

 

Like:

Exchange rate, trends for some years

Bureaucracy

Corruption

Consumer attitude

 

 

We have to suggest by the end whish country is best to establish subsidiary in.

We have to use Treasury bonds of the government (macro economic risks)

Find the Market return

Fixed deposit Bank rate can be used

How can we adjust risk with the discount rate?

Some assumptions are good

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