International Business Management Research Paper

International Business Management Research Paper
CAMBRIDGE ASSOCIATION OF MANAGERS Postgraduate Diploma in Management INTERNATIONAL
BUSINESS MANAGEMENT The Impact of Fixed Exchange Rates in a Global Economy A Research Project
Report on the Relevance of Fixed Exchange Rate Systems A case of World Vision Kenya Student's Name:
Hesbone Nzambuli Kang'e Registration Number: CAM/2006/PGD/KEN/00143 Purpose: Fulfilment of the
Requirements of the Postgraduate Diploma in Management Presented to: Cambridge Association of Manger,
International Examinations, UK August 2007 DECLARATION I declare that this project is my original work and
has not been exhibited or published in any way and has never been presented for any awards in any ... Show more
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Further research is also recommended on the quantitative impact of FERSs on Not–For–profit organisations.
These findings and recommendations will provide a reference point for WVK and other Non–Governmental
Organisations (NGOs) as they endeavour to minimise the impacts of fluctuating ERs on its business. Researchers
and academicians will draw lessons from these findings, especially as they design appropriate Exchange Rates
Systems for NGOs. TABLE OF CONTENTS | |PAGE | Declaration i Acknowledgemnts ii Executive Summary iii
Table of Contents iv List of Tables and Figures vi List of Tables vi List of Figures vi Definition of Terms,
Abbreviations and Acronyms vii Definition of Key Operational Terms vii List of Acronyms and Abbreviations
viii Chapter One: Introduction 1 1.1. Organisational Background 1 1.2. Research Context 1 1.3. Statement of the
Problem 1 1.4. Research Justification and
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The Government Adopted The Convertibility Plan
collapse, the Argentine government adopted the Convertibility Plan, which was a currency board arrangement
that fixed the nominal exchange rate between the local and foreign currency at parity. This meant that the Central
Bank would hold an equal amount of dollars in its reserves to the amount of pesos in circulation.
Panama, on the other hand, dollarized as a result of political and historical processes rather than as a culmination
of crisis–inducing events. Panama is one of the oldest dollarized countries, which is due to the fact that the
country has been a historical host of regional trade and transit channels. As a result, the country has experienced
high levels of international influence, with the United States acting as one the country's major trading partners.
The fact that Panama was already economically and financially integrated in regional markets meant that the
adoption of the dollar was more of a natural step for the country in comparison to Ecuador and Argentina.
Macroeconomic outcomes
One of the biggest benefits of dollarization that has been noted in the literature has been its impact on reducing
high inflation rates. Ecuador and Panama have both shown evidence of having consistently low and stable
inflation rates. Inflation rates in Ecuador did not immediately converge with international prices due to price
adjustment delays and increased fiscal spending. Eventually, the country's price levels fell to a commendable rate
of 2.7 percent in 2004.

Devaluation On The Argentine Economy
| Currency devaluation and its effects on the economy | Focus on the Argentine economy | Agustina DalFabbro,
Michele Mottola, Giuseppe Merlino, Saskia Diehl 26.05.2012 | Inhalt 1. Introduction 2 2. Convertibility and its
problems in the 1999/2001 period 2 1.1 Previous Devaluation Process in Argentina 2 2. First moments of
devaluation 3 2.1 Fixed exchange rate vs. floating exchange rate regimes 3 2.2 Two types of exchange rates and
free floating currency 5 2.2 Free floating currency 6 3. Effects of Devaluation process on 6 3.1 Trade Balance 6
3.2 Productive capacity 6 3.3 Salaries 6 3.4 National Accounts 6 4. Conclusion 6 5. Literature 7 1. Introduction
Stable currency exchange rate regimes ... Show more content on Helpwriting.net ...
Since the volatility of floating rates causes costs for exports and imports. It also encourages international capital
flows which can profit the welfare of a country. Especially in case of developing countries these capital flows can
be very large. One big Problem of the exchange rate regimes is the loss of monetary and fiscal possibilities to
stabilize the economy as well as Limitation of the ability to pursue domestic goals. There is a slight difference
between a hard peg and a fixed exchange rate, since the fix exchange rate can be with several countries whereas
the hard peg only pegs it currency to one foreign country. They have more or less the same ad– and
disadvantages, but with a fixed exchange rate, which is pegged to more than one country, the pursuit of domestic
goals is easier, since the country does not depend on one foreign economy. One major weakness of the fixed
exchange rate is, that when devaluation becomes necessary through fundamental changes in economy. Even the
announcement of devaluation creates the danger of a crisis and eventually ends in a crisis, like the case of
Argentina shows. It is also likely that a currency crisis after devaluation can end up in a banking crisis, since
fixed exchange rates give incentives to take on debt. (see below for further information) Floating exchange rates
can be found for example in the arrangement of the U.S. with their

A Review On Currency Devaluation
Introduction
Imagine you are in charge of economic policy in your country. Inflation starts to creep up. The value of your
currency is losing ground which is making the debt you incurred even greater. Now your GDP is affected as you
struggle, trying to figure out the best response for both short term and long term economic health. This is what
Argentina faced in the late 1900's after many decades of prosperity. Even the best intended responses to an
economic crisis may or may not correct the situation or may even exacerbate it, as outlined in the Case Study by
Gerber (2010) in Argentina.
A review of currency devaluation will set the stage for an analysis of the case and Argentina's response to their
lengthy crisis. Currency ... Show more content on Helpwriting.net ...
In 1900, Argentina was one of the richest countries in the world, but then by 1950 an income gap started to form
as the U.S. and Europe's incomes caught up and passed Argentina. Then the Latin American debt crisis struck in
the 1980's along with the Lost Decade of the 1980s and Argentina's GDP fell 7 percent while at the same time
inflation skyrocketed by more than 3,000 percent. Several experiments were performed with no clear success
until they fixed their currency to the U.S. dollar at 1:1 and restricted the printing of money. In 1990, Argentina
created a currency board to enforce rules and monitor exchange rates which was successful through 1998 until an
economic crisis in East Asia caused Brazil to devalue its currency placing Argentina firms at a disadvantage
leading to a negative current account balance in Argentina of 4 percent of the GDP leading to a 1999 recession.
With Argentina total expenditures down and a recession in place, a demand–side stimulus would be in order
including cutting taxes, increased government spending, and increasing the money supply however, there were
problems with these changes. The 1:1 ratio and raising prices by expansionary policies were seen as problematic
and even counterproductive. Currency devaluation would also be a problem as they borrowed dollars during all
the growth years and the decreasing value of the Peso

Honda Annual Report
Honda Motor Co., Ltd. Annual Report 2009
Annual Report 2009
Honda Motor Co., Ltd.
Year Ended March 31, 2009
Contents
2 3 6 8 18 The Power of Dreams Summary of Operating Results by Business Financial Highlights To Our
Shareholders Review of Operations
Motorcycle Business Automobile Business Power Product and Other Businesses Financial Services Business
36 37 39 46 49 81
Preparing for the Future Risk Factors Corporate Governance Board of Directors, Corporate Auditors and
Operating Officers Financial Section Corporate Information
Principal Manufacturing Facilities Honda Group Honda's History Investor Information
Reports Published by Honda
CSR Report
This report provides an overview of Honda's position on corporate ... Show more content on Helpwriting.net ...
*As of March 31, 2009
Caution with Respect to Forward–Looking Statements
This annual report contains "forward–looking statements" as defined in Section 27A of the Securities Act of
1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are
based on management's assumptions and beliefs, taking into account information currently available to it.
Therefore, please be advised that Honda's actual results could differ materially from those described in these
forward–looking statements as a result of numerous factors, including general economic conditions in Honda's
principal markets; foreign exchange rates between the Japanese yen and the U.S. dollar, the Euro and other major
currencies; and extensive environmental and other governmental regulations, as well as other factors detailed
from time to time.
Annual Report 2009
1
The Power of Dreams
Dreams inspire us to create innovative products that enhance mobility and benefit society. To meet the particular
needs of customers in different regions around the world, we base our sales networks, research & development
centers and manufacturing facilities in each region. Furthermore, as a socially responsible corporate citizen, we

strive to address important environmental and safety issues.
2
Annual Report 2009
15
Summary of Operating Results by Business
Percentage of Net Sales by Business
Motorcycle

Argentina 's Post Crisis Economic Reform
Argentina's Post–Crisis Economic Reform I. Summary a. Following a steep currency devaluation and the largest
sovereign debt default in history, Argentina entered a deep recession with high unemployment and social
upheaval i. Brought to power new gov't ii. With it, a shift away from market–oriented policies toward greater
gov't control of the economy in the pursuit of social equity b. Policies reflect priority for financial independence,
social equity, and what may be considered a commitment to populist macroeconomic policies c. What stands out
to many is the policy choices Argentina's government has made i. Trade protection ii. Managed exchange rates iii.
Capital controls d. New emphasis on social equity placed strain on budget, but ... Show more content on
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Eliminated the currency board that had directed economic policy since 1991, limited bank and foreign currency
transactions c. Social policy became the new priority d. Due to a lack of revenue, taxes were placed on exports
and financial transactions i. Meant to be temporary taxes but became permanent with time e. Recovery took hold
and Argentina was able to succeed with these expansionist policies due to strong demand for Argentine
commodities i. Enjoyed nine years of solid growth ii. From 2003–2011, the value of Argentina's soy exports to
China (the primary exports) increased by 241% iii. Similar trends applied for other 2 major exports, soy oil and
crude petroleum iv. "Prosperity based on good harvests and strong overseas markets obscured a dangerous
vulnerability" v. (Colin M. MacLachlan, Argentina: What Went Wrong (Westport: Praeger, 2006), p. 36. f.
Expansive fiscal and monetary policies reinforced growth and debt repudiation allowed for fiscal resources in the
name of social equity g. Foreign economic policies were designed to carry out domestic political agenda, due in
large part to the disdain of overseas financial institutions and meddling in domestic affairs, which some viewed
as one of the main precursors to the deterioration in 2001. IV. The New Economic Framework a. 2003 to 2011:
economy grew robustly with the exception of the 2008 global downturn i. Gov't ran a fiscal surplus, reflective of

Argentina Essay
I. INTRODUCTION Argentina lives in a democracy since 1986. Before this year lived it under a military regime.
In the nineties under the presidency of
Menem the country experienced a great increase in the liberalization of trade.
Argentina has a free market economic system. Due to the recent privatization program, the State now has a very
limited role in the economy. According to the Competitiveness Report of the World Economic Forum Argentina
is classified as one of the most open, least protectionist countries in the world.
Its currency is convertible to the US dollars and there is total freedom for moving capital internationally.
Argentina has conducted one of the most intensive privatization programs in the world. The telephone company,
... Show more content on Helpwriting.net ...
Imports from Brazil represent 35 percent of the local import market. The gains in imports with exports from
Brazil boost employment in Argentina by a 30 percent and bilateral trade with Brazil as well as nine fold growth
in investments. (States–USA). See AUTO
PARTS/SERVECE table in appendix. In the period of July 1997–June 1998
Argentina exported wheat to the following countries: Brazil, Turkey, Egypt,
Iran, Peru, Indonesia, Sir Lanka, Jordan, Tunisia and Kenya. Argentina experiences "inter" trade with these
countries because it has the comparative advantage of producing wheat at a cheap cost. Soils in Argentina are
fertile and farmers do not need to use as much fertilizers as in the case of European farms. European farms have
been harvested for years. As a consequence of this farms need to be fertilized or remain unused for a period of
four years to produce crops. Argentina engages in "inter" trade on the exports of corn to the following counties:
Japan, Brazil, Egypt, Taiwan, Peru, Chile, Spain, Iran,
Venezuela, and Colombia. Argentina exports corn to Brazil because it does not produce enough corn to supply its
domestic demand. Argentina also produces "Inter" trade exports of sorghum with Japan, Mexico, Taiwan,
Colombia, Norway, Spain, and Chile. Argentina and Brazil benefit from trade among themselves because each
country exports something in which it does not have the comparative advantage or in

FIN REVIEW
CH 1 Quiz
1. Suppose your firm invests $100,000 in a project in Italy. At the time the exchange rate is $1.23= 1.00 Euros.
One year later the exchange rate is the same, but the Italian government has expropriated your firm's assets
paying only 80,000 Euros in compensation. This is an example of
a. Political risk
2. Country A can produce 10 yards of textiles or 6 pounds of food per unit of input. Compute the opportunity cost
of adding one additional unit of food instead of textiles.
a. 1 yard of textiles per 6 pounds of food
3. In countries like France or Germany
a. Managers have often viewed shareholders as one of the "Stakeholders" of the firm, others being employees,
customers, suppliers, banks, and so forth.
4. The common ... Show more content on Helpwriting.net ...
If the U.S., currency depreciates against the currencies of our trading partners.
ANSWER: your competitive position is likely improved.
20. Production of goods and services has become globalized to a large extent as a result of _______.
ANSWER: Multinational corporations' efforts to source inputs and locate production anywhere where costs are
lower and profits are higher.
21. Country A can produce 10 yards of textiles or 6 pounds of food per unit of input. Compute the opportunity
cost of producing one additional unit of food instead of textiles.
ANSWER: 1 Yard of textile per .6 pounds of food
22. Which is growing at a faster rate, foreign direct investment by MNCs or international trade?
ANSWER: FDI by MNCs
23. Suppose that Great Britain is a major export market for your firm, a U.S. based MNC. If the British pound
depreciates against the U.S. dollar,
ANSWER: both b and c are correct
24. When corporate governance breaks down
ANSWER: All the above
25. MNCs can use their global presence to
ANSWER: all the above
26. Suppose you start with $100 and buy stock for 50 Pounds when the exchange rate is 1 pound = $2. One year
later, the stock rises to 60 pounds. You are happy with your 20% return on the stock but when you sell the stock
and exchange your 60 pounds for dollars, you only get $45 since the pound has fallen to 1 pound=$.75. This loss
of value is an example of _______
ANSWER: Political risk

Petrobras
9–204–043 REV: MARCH 10, 2004 MIHIR DESAI Drilling South: Petrobras Evaluates Pecom If you live in our
neighborhood, you 've got to look at Argentina. It 's going through a major crisis today, but it is the second largest
market in South America.1 – Francisco Gros, CEO, Petrobras João Nogueira Batista, Chief Financial Officer of
the Brazilian firm Petrobras, reflected on Gros's words as he prepared for a Board of Directors meeting in July
2002. The main item on the Board's agenda was the proposed acquisition of an Argentinean firm, the Perez
Companc Group, or Pecom.2 The acquisition would significantly increase Petrobras's oil and gas production and
add to its oil reserves. It would also provide the mainly Brazilian–based ... Show more content on Helpwriting.net
...
Petrobras's official monopoly ended in January 2002, when the Brazilian government deregulated domestic prices
for crude oil and oil products. Petrobras's first discoveries were made onshore in the Northeast of Brazil in the
1950s and 1960s. In the mid 1980s, when the giant deepwater pools in the Campos Basin were discovered and
developed, the profile of the company started to shift upstream toward exploration, development, and production.
Upstream and Downstream Activities4 By 2001, almost 50 years after its inception, Petrobras had become a fully
integrated oil and gas company. Petrobras was the seventh largest publicly traded oil and gas company in the
world based upon proven reserves, the largest Brazilian corporation, the third largest Latin American corporation,
and the 185th largest global company, by 2001 consolidated revenues. In Brazil, Petrobras had a dominant
position in both upstream and downstream activities. The company's combined oil and gas production was 1,621
tbpd and it had proven reserves estimated at around 9.3 billion boe.5 (Exhibit 1 provides selected oil and gas data
for Petrobras and other oil companies.) Most of the firm's proven reserves were located in very deep waters
(more than 400 meters) and Petrobras was the world's pioneer in deep water oil exploration and production.
Furthermore, with approximately

Fins2622 Notes
REGIONAL ECONOMIC INTEGRATION The Political Economy of Free Trade  Free Trade: David Ricardo
(support free trade) o Theory of comparative advantage: For two nations without input factor mobility,
specialisation and trade could result in increased total output and lower costs than if each nation tried to produce
in isolation.  Both nations can benefit from trade if each specialises in good that they have the lowest
opportunity cost, even if one economy is more efficient in making everything.  However, Comparative
advantage in not static, and changes over time in reality.  Also, comparative advantage assumes that factors of
production can't move between countries  therefore comparative advantage is set to be outdated ... Show more
 Economic interdependence means lesser escalation of political conflicts. Impediments to Integration 
Inefficient industries lose out (e..g US steels, and textiles) however, if a country protects these inefficient
industries, this in turn will make other industries become less internationally competitive, due to the high cost of
imports.  Governments are forced to compromise some degree of national sovereignty.  National interests
may not equal regional instruments  Political/industrial interest groups (need to be overcome).  Third largest
population of 500 million (after China and India), 340 million high income consumers.  World largest economy
in terms of GDP  Reasons for formation of this union: o Avoid future political conflict o Gain size, scope and
efficiency advantages that allow European nation state to compete with the US and Japan.  Some argue that
the current degree of integration is an economic union with an evolving common political structure (but this is
not entirely true given that all countries do not share a common fiscal policy). EU Objectives  Provide for free
internal flow of production factors: o Labour o Capital o Products  Provide protection for European industry
and workers (free trade within and protection outside countries) o Tariffs and quotas applied to most basic
commodities and services  Steel, Coal, Textiles, Agricultural Products  Banking,

Globalization and the International Monetary Community Essay
Executive Summary
Our world is steadily shrinking. Technology is building bridges over the barriers of distance, language, and
culture. It's a process called globalization, and it is changing the way we live. Financial institutions haven't been
immune to the effects of this change. In fact, the international nature of financial institutions makes them
particularly vulnerable to change. This paper addresses three issues caused by the globalization of the
international monetary community.
First this paper examines the success of the Euro, and the implications for the formation of a global currency.
Then this paper looks at the issue of devaluation, and by comparing successful and unsuccessful devaluations
tries to determine ... Show more content on Helpwriting.net ...
Humanity's life got much easier when money was invented. From ten foot tall coins to small strips of paper,
currency is one of the most important inventions the human race has discovered. The invaluable ability to trade
any item for a standard of value is what makes economy possible. Today, currency issues face the looming
prospect of globalization. Like a tornado on the horizon, globalization is threatening to reform international
currency into a twisted shape unlike anything we have ever seen. This paper addresses some of the major
currency issues facing international financial organizations today. First the success and growing pains of the Euro
will be discussed, with an emphasis on the implication of the Euro's success on world currency. Next this paper
will look at the devaluation of currency. The paper will also analyze what makes devaluation successful, and how
devaluations are sometimes simply legalized theft from a country's money holders. The final issue brought up by
this paper is the rising trend of dollarization. Shaky economies are using the dollar to stabilize their currency, and
more is being discovered about the implications of this practice all the time. The international currency
community is facing many opportunities and challenges, a few of which are listed above. Hopefully these issues
will paint a broad picture of a global financial community about to be picked up, spun around, and deposited in a

Markets And International Monetary Fund
Markets Want Greece in the Eurozone The fickleness of financial markets is a constant source of both frustration
and amazement, particularly in the Eurozone. Having started last week concerned about the ramifications of a
resounding "No" vote in Greece's referendum about bailout terms imposed by the Troika, there was a strong rally
in anticipation of deal eventually being signed between Greece and her creditors. Markets have, therefore,
seemingly taken the view that the best known outcome is for Greece to remain in the single currency, regardless
of the imperfections of any agreement. In the absence of substantial debt write–downs, however, the situation
facing Greece remains dire. Both the US and International Monetary Fund (IMF) have ... Show more content on
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Thus, this highlights the utter hypocrisy of the current negotiations surrounding Greece: both France and
Germany, in fact, conveniently ignored the rules for the fiscal convergence criteria when it suited them. Neither
country was sanctioned in a major way. France could well find itself in the firing line if it fails to prevent a Greek
exit from the single currency. The sustainability of the current membership of euro has, therefore, not been laid to
rest. Understanding Events in China Events in China took on a new level of intensity last week as the authorities
attempted to stabilise the equity market. The weakness appears to be event–drive as opposed to being the result of
economic malaise. In fact, recent economic data out of China suggests that recent stimulus measures appear to
have had some traction. The event in question appears to be a large margin call being made by one of the main
regulatory authorities. Recently, I mentioned that margin debt as a percentage of GDP was a relatively high 8%.
The problem facing the authorities was sourcing where the trouble was emanating from. Margin debt can be
originated from two sources: 1) licensed brokers, and 2) the so–called grey market within the shadow banking
system. The origination split is roughly 50/50 between the two sectors. This is where the similarities end. At
licensed brokers, margin credit can only be extended for up

International Monetary Fund IMF Essay
IMF
International Monetary Fund
The International Monetary Fund–also known as the "IMF" or the "Fund"–was conceived at a United Nations
conference convened in Bretton Woods, New Hampshire, U.S. in July 1944. The 45 governments represented at
that conference sought to build a framework for economic cooperation that would avoid a repetition of the
disastrous economic policies that had contributed to the Great Depression of the 1930s.
==►IMF describes itself as "an organization of 184 countries, working to foster global monetary cooperation,
secure financial stability, facilitate international trade, promote high employment and sustainable economic
growth, and reduce poverty".
Development of issues towards IMF
==►In the 1930s, as ... Show more content on Helpwriting.net ...
Mandate of IMF at that Time:
1. It should stabilize and establish a clear and single value for each currency.
2. Encourage unrestricted convergence of one currency into another.
3. oppose practices as comparative devaluation (The effect of comparative devaluation: There was shift in
investment flow that has totally restricted the trade)
4. There immediate post war objective was ==►elimination of exchange restrictions relating to trade in goods
and services, and the stability of exchange rates.
Exchange rate stability – par value system
==►Countries that joined the IMF between 1945 and 1971 agreed to keep their exchange rates (the value of their
currencies in terms of the U.S. dollar and, in the case of the United States, the value of the U.S. dollar in terms of
gold). That was very stable exchange rate system and was known as Par Value System also known as the Bretton
Woods system.
==►prevailed until 1971, when the U.S. government suspended the convertibility of the U.S. dollar (and dollar
reserves held by other governments) into gold.
==►Since then, IMF members have been free to choose any form of exchange arrangement they wish (except
pegging their currency to gold): allowing the currency to float freely; pegging it to another currency or a basket
of currencies; adopting the currency of another country; or participating in a currency bloc.
Over the Years Challenges faced by IMF
1. End of the par

Financial Structure and International Debt Essay
Chapter 14
Financial Structure and International Debt
( Questions
1. Objective. What, in simple wording, is the objective sought by finding an optimal capital structure? When
taxes and bankruptcy costs are considered, a firm has an optimal financial structure determined by that particular
mix of debt and equity that minimizes the firm's cost of capital for a given level of business risk. If the business
risk of new projects differs from the risk of existing projects, the optimal mix of debt and equity would change to
recognize trade–offs between business and financial risks.
2. Varying Debt Proportions. As debt in a firm's capital structure is increased from no debt to a significant
proportion of debt (say, 60%), ... Show more content on Helpwriting.net ...
Returns are not perfectly correlated between countries.
In contrast, a domestic German firm would not enjoy the benefit of cash flow international diversification but
would have to rely entirely on its own net cash inflow from domestic operations. Perceived financial risk for the
German firm would be greater than for a multinational firm because the variability of its German domestic cash
flows could not be offset by positive cash flows elsewhere in the world.
5. Ex–Post Cost of Borrowing. Exhibit 14.2 in the text shows that Deutsche Bank borrowed funds at a nominal
cost of 9.59% per annum, but at a later date that debt was selling to yield 7.24%. Near the other extreme, the
Kingdom of Thailand borrowed funds at a nominal cost of 8.70% but after the fact found the debt was sold in the
market at a yield of 11.87%. What caused the changes, in this case in opposite directions, and what might
management do to benefit (as Deutsche Bank did) rather than suffer (as the Kingdom of Thailand did)?
Changes in foreign exchange rates caused the ex–post cost of borrowing to increase or decrease from what was
originally expected. Management can only guess at future foreign exchange risk. Therefore, they could either
borrow only in their functional currency or diversify by currency their sources of borrowing.
6. Local Norms.

Argentina 's Turbulent History Of Economic Crisis Essay
Argentina's turbulent history of economic crisis are often attributable to government mismanagement and
fluctuating commodities prices, which have resulted in the millions to live below the poverty line. Repeated
recessions of the 1970s and 1980s, the hyperinflation of 1989–90, the economic crisis of 2001. Argentina is a
long way from the turmoil of 2001, but today's mix of rising prices, wage pressures and the mistrust of the peso
have prompted Argentineans to become overrun by a sense of nostalgia.1 According to the article Five Years of
Competitive and Stable Real Exchange Rate in Argentina, 2002–2007, SCRER is an acronym for "stable and
competitive real exchange rate" and this policy has promoted economic growth over the 2002–2007 period by
improving external and fiscal account sustainability and providing incentives to the tradable sector, resulting in
increased production, employment, and investment. The SCRER turned out to be one the the primary factors in
the explanation of the current account adjustment, which went from a US $14.5 billion deficit in 1998 to a US$
7.6 billion surplus in 2006. The SCRER policy also contributed to the improvement of the trade balance because
Argentinian exports became more competitive as a result of the real exchange rate depreciation. Argentina then
took advantage of this newfound competitiveness by taxing some of its exports in highest demand, namely
agricultural products and oil. Consequently, by 2006 the government recorded a

Monetary Policy And Balance Of Payment Crisis Of Argentina
Introduction:
Monetary instability has been a factor in Argentina since the 1950s. The period of high inflation, which at its
peak was 444%, that starts with the military dictatorship in 1976 and peaks during Raul Alfonsin in 1989 at
3080% was unprecedented. However, the "solutions" that came about in the early 1990s to solve this inflationary
problem had severe unintended consequences. Deflation for 3 consecutive years brought about a recessive spiral
that culminated in the biggest sovereign debt default in history. The objective of this paper is to investigate the
monetary policy and balance of payment crisis of Argentina, and to research its impact on inflationary
oscillations, specifically in the inflation period of the 1970s, hyperinflation period of the 1980s and the deflation
period of the 1990s.
Argentine Inflation by Decade (consumer prices annual %)
Period Average Maximum Minimum
1920–1929 –1.7 17.1 –15.9
1930–1939 –0.3 13.0 –13.9
1940–1949 10.6 31.1 –0.3
1950–1959 30.3 111.6 3.7
1960–1969 23.3 31.9 7.6
1970–1979 132.9 444.0 13.6
1980–1989 565.70 3079.80 90.1
1990–1999 252.92 2,314.0 –1.2
2000–2009 8.59 25.9 –1.1 Source: World Bank Data, World Development Indicators & Global Development
Finance
Inflation And Its Problems: A Background
Argentina had repeated cycles of hyperinflation followed by attempts at stabilization. A typical cycle in such an
inflationary economy begins with the acceleration of money creation to

The Allende Governance A New Governance Essay
After the fall of the Allende governance a new governance was applied which led to rise of free market economy
through the use of different reforms like privatization and deregulation. With low level of understanding in
economics Pinochet hired economists who were tasked with freeing the economy from the previous destruction
caused by socialists. According to De Haan by 1970 Chile recorded least freedom in its economy (De Haan et al
220). But later the economy started experiencing major growth from 1980s which increased economic growth
from7.2 percent compared to other countries in South America. While the country economic progress has
received international recognition, their development hasn't been easy as it has faced major critical moments to
their economic success. For example during the 1982 recession the gross domestic product dropped by 14.1 %
which resulted to overvaluation of their currency which made the currency more vulnerable to harsh changes in
international economy. This changes led to decrease in capital which decreased availability of finance meant to
finance investments. According to Buchi this led to an increase in unemployment by 23% and decrease in salaries
and wages by over 10% (Buchi 10). Years later Chile has been able to experience economic growth especially in
the 1980s compared with other countries in South America who underwent similar crises. This success has been
achieved through the application of crisis management process which had affected

A Brief Note On Polyethylene : How Does The Industry Work?...
Rsm437 Assignment 3
Q1: how does the industry work?
Polyethylene is a petrochemical product that has been widely used in the plastic manufacturing, such as
packaging, trash bins, and food containers. It is produced mainly from the polymerization process of ethylene,
which is an ingredient derived from cracking crude oil and natural gas. There are three types of polyethylene:
low–density polyethylene (LDPE); high density polyethylene (HDPE); and low linear density polyethylene
(LLDPE), and each of them has distinctive commercial applications.
Polyethylene industry is considered as highly capital intensive since it requires large plant size to sustain the
enormous production capacity and so as to fulfill the huge demand of the industry. Therefore, in order to be
competitive and successful in this industry, the need for economies of scale is vital, since it contributes to greater
revenues and sales volume of the company with a great proportion of saving in the costs. Also, the industry's
profitability is highly correlated to the company's operating rate, which also refers to the capacity utilization rate
of the company. The higher the percentage of the company's total capacity is being used, the higher profit
margins are accompanied by. However, notice that an excessive operating rate that over–utilizes the company's
available resources would lead to an oversupply of the production in the industry, which pulls down
polyethylene's market price and deteriorates the company's

The Importance of Transfer Pricing Essays
| The Importance of International Transfer Pricing | Country Case: Argentina | | | | International Accounting –
ACG6255 Professor Robert McGee Philip Archer | Table of Contents 1. Abstract 2. Transfer Pricing Overview 3.
Defining Transfer Prices 4. Arm's Length Principle 5. Pricing Methods 6.1. Comparable Uncontrolled Price
Method (CUP) 6.2. Comparable Uncontrolled Transaction Method 6.3. Resale Price Method (RPM) 6.4. Cost–
Plus Pricing Method (CPM) 6.5. Transactional Net Margin Method (TNMM) 6.6. Profit–Split Methods (PSM)
6.7. Advance Pricing Agreement (APA) 6. Argentina Overview 7. Transfer Pricing Rules in Argentina 8.
Conclusion ... Show more content on Helpwriting.net ...
As Choi and Meek exemplify, transfers between related business units represent 60 percent of all international
trades (Choi & Meek, p. 448). Thus, one can start to understand how important it is to define accurate
transfer prices. As mentioned, the globalization of markets and the rapid development of communication systems
have increased the presence of trades between companies under common control. However, other factors have
also helped highlight the subject. Factors like the increase of service provided within MNE's, the continuous
trading activity and the use of financial instruments have increased the amount of trade between associated
parties. Political forces have also assisted in the development of transfer pricing regulations, especially now
during this economic crisis as governments try to increase their income through tax collection. For example, a
parent company could pay less income tax in the US by determining a higher transfer price from the product it
purchases from its subsidiary located in China. Since China's corporate income tax is 25% and the US tax rate is
35%, this arrangement would generate a higher income at the subsidiary in China and less overall income tax
payment for the financial group in question. Nevertheless, such arrangements can be prevented by tax authorities
in the US, since according to Section 482 of the Internal Revenue Code "the Secretary may distribute, apportion,
or allocate gross income, deductions, credits, or

A Better Map Of Europe
Christine, need a better map of Europe
EUROPE
Europe is the 6th largest continent and is actually a vast peninsula of the great Eurasian land mass.
Regions
Europe can be divided into seven geographic regions: Scandinavia (Iceland, Norway, Sweden, Finland, and
Denmark); the British Isles (the United Kingdom and Ireland); W Europe (France, Belgium, the Netherlands,
Luxembourg, and Monaco); S Europe (Portugal, Spain, Andorra, Italy, Malta, San Marino, and Vatican City);
Central Europe (Germany, Switzerland, Liechtenstein, Austria, Poland, the Czech Republic, Slovakia, and
Hungary); SE Europe (Slovenia, Croatia, Bosnia and Herzegovina, Serbia, Montenegro, Albania, Macedonia,
Romania, Bulgaria, Greece, and the European part of Turkey); and E Europe (Estonia, Latvia, Lithuania, Belarus,
Ukraine, Moldova, the European portion of Russia, and by convention the Transcaucasian countries of Georgia,
Armenia, and Azerbaijan).
Europe is a unique continent, which is not surrounded by water from all directions, and has an overland border
with the neighbouring Asia. Physiographically, it occupies the northwestern part of the large landmass known as
Eurasia and surrounded from the north by the Arctic Ocean, from the west by the Atlantic Ocean, from the south
by the Mediterranean Sea, and from the southeast by the Black Sea.
Definition of correct border between two continents was a big question for geographers and politicians.
Nowadays it is commonly delineated by the Ural Mountains in

An Overview of the Argentine Financial Crisis Essay
The financial crisis in Argentina during the late 1990s and early 2000s resulted in severe issues with foreign debt,
inflation, unemployment, and political turmoil for the country. Argentina not only suffered a currency crisis, but
also suffered a political crisis. Fallout from the economic collapse was so severe the Argentinean population
resorted to civil unrest and protest, which in turn exacerbated Argentina's problems at the turn of the century.
While other issues related to this financial crisis such as the impact on the lives of the Argentinean population or
the political turmoil and corruption are certainly worthy of discussion, this paper will focus on the currency crisis
and the Argentinean government's role in this economic ... Show more content on Helpwriting.net ...
In an effort to move Argentina from an internationally isolated and state–dominated economy to one that
encouraged international trade and foreign investments, Carlos Menem, in the early 1990s, initiated a wave of
privatization, which included state–owned industries such as utilities (Feldstein, 2002). Following the examples
of Chile and the emerging economies of Southeast Asian nations, Menem hoped this liberalization would foster
growth in productivity and economic growth.
On April 1, 1991, Argentina's Congress, with Domingo Cavallo as Minister of Economy, enacted the
Convertibility Law (or Ley de Convertibilidad) legally adopting the currency board (Hornbeck, 2002). This
legislation essentially pegged the Argentinean peso to the U.S. dollar. The government guaranteed the
convertibility of the peso to U.S. dollar at a one–to–one exchange rate, limiting the printing of pesos to only those
necessary to purchase dollars in the foreign exchange market. Thus, the central bank was required by law to hold
foreign reserves to cover its peso liabilities (Hanke and Schuler, 2002). With this fixed exchange rate, the
Argentinean government was hoping to preserve the value of their currency and stabilize inflation. The peg was
initially successful, as it cured hyperinflation that occurred at the end of the 1980s and provided price stability
needed for economic growth in the early 1990s. However, by the late 1990s,

Globalizing the Cost of Capital and Capital Budgeting at Aes?
9–204–109
REV: OCTOBER 23, 2006
MIHIR DESAI
Globalizing the Cost of Capital and Capital Budgeting at AES
In June 2003, Rob Venerus, director of the newly created Corporate Analysis & Planning group at The AES
Corporation, thumbed through the five–inch stack of financial results from subsidiaries and considered the
breadth and scale of AES. In the 12 years since it had gone public, AES had become a leading independent
supplier of electricity in the world with more than $33 billion in assets stretched across 30 countries and 5
continents. Venerus now faced the daunting task of creating a methodology for calculating costs of capital for
valuation and capital budgeting at AES businesses in diverse locations around the world. He would ... Show more
The willingness of international development banks to invest alongside AES in volatile parts of the world helped
mitigate the risk of expropriation, and the increased breadth of the global financial markets provided greater
access to capital. AES initiated its international expansion in 1991–1992 with the purchase of two plants in
Northern Ireland. The following year, AES began what would become a massive expansion into Latin America
with the acquisition of the San Nicolas generation facility in Buenos Aires, Argentina. A year later, AES created a
separately listed subsidiary, AES China Generating Co., to advance Chinese development projects. As the pace of
deregulation quickened around the world, AES was presented with an abundant supply of capital and a wealth of
opportunities for investments in energy–related businesses, some of which were more complex than AES'
portfolio of contract generation projects. In addition to expanding its line of business profile, it continued its
geographic expansion and between 1996 and 1998 the company acquired several large utility companies in
Brazil, El Salvador, and Argentina. By this time the company was spending an estimated 80%–85% of its capital
investment overseas in places as diverse as Australia, Bangladesh, Canada, Cameroon, The Dominican Republic,
Georgia, Hungary, India, Kazakhstan, the Netherlands, Mexico, Pakistan, Panama, Puerto Rico, Ukraine, The
United Kingdom,

Argentin A Country Located On The South Side Of South America
Argentina is a country located on the south side of South America. It is bordered by the Andes in the west and the
South Atlantic Ocean to the east, neighboring countries are Chile to the west, Bolivia and Paraguay to the north,
and Brazil and Uruguay to the northeast. Argentina is the second largest country of South America after Brazil,
and the 8th largest country in the world. Its total area is approximately 2.7 million km². Argentina claims a
section of Antarctica but has agreed to temporarily stop sovereignty disputes in the region as a signatory to the
Antarctic Treaty. Argentina also asserts claims to several South Atlantic islands controled by the United
Kingdom. With a population of more than 42.1 million, Argentina ranks as the ... Show more content on
Helpwriting.net ...
With the declaration of independence on July 9, 1816 and the military defeat of the Spanish Empire in 1824, a
federal state was formed in 1853–1861, known today as the Republic of Argentina.
Argentina's Financial System
a. Historical Overview
The economic history of Argentina is one of the most studied, owing to the "Argentine paradox", its unique
condition as a country that had achieved advanced development in the early 20th century but experienced a
reversal, which inspired an enormous wealth of literature and diverse analysis on the causes of this decline.
Argentina possesses definite comparative advantages in agriculture, as the country is endowed with a vast
amount of highly fertile land. Between 1860 and 1930, exploitation of the rich land of the pampas strongly
pushed economic growth. During the first three decades of the 20th century. Argentina outgrew Canada and
Australia in population, total income, and per capita income. By 1913, Argentina was the world 's 10th wealthiest
nation per capita. Beginning in the 1930s, however, the Argentine economy deteriorated notably. The single most
important factor in this decline has been political instability since 1930, when a military junta took power, ending
seven decades of civilian constitutional

Essay about Argentina and the IMF
Argentina, the IMF, and the WTO
In 1999, over 40,000 people came to protest in the streets outside the Seattle Conference Center, where the
delegates from the World Trade Organization (WTO) and the International Monetary Fund (IMF) came to Seattle
to discuss new international trade agreements. Many came to protest not only against the WTO and the IMF, but
also against globalization itself; Thousands were protesting for anti–globalization because of increasing concerns
that certain trade and investment measures were encroaching on national sovereignty. Everyone feared that too
much power was being centralized into organizations like the WTO and the IMF. Other reasons included the
widening gap between the rich and the poor; the creation of ... Show more content on Helpwriting.net ...
There is no definite answer as to why Argentina went into such an economic crisis, but looking at its tumultuous
history gives clues and possible causes that could have contributed. When Argentina first gained independence
from Spain, all of the provinces fought each other until a very tenuous democracy was formed in 1860. Along
with a considerably shaky government, economic policies generally caused more harm than good. At the time
budget deficits were handled by printing more money, so inflation was a constant issue that still continues to
affect Argentina to this day. In the late 1800s and early 1900s, Argentina's economy began to increase, due to
rising exports of beef and wheat to Europe, made possible by the new technologies of railroads and refrigerator
ships. During the 1930s, when Argentina was going through difficulties with its trading partners, it switched its
economy to an "import substitution" economy–a "largely closed, self–sufficient economy, with high tariffs and
extensive government direction." This made the exchange rates become highly overvalued, which led to a lot of
importation, but not enough exportation to balance out the debt. There was low economic growth and even more
frequent inflation; percentage wise, inflation was in the triple digits from 1975 on. However, in 1989, Carlos
Menem became president, and

The Mexican Peso Crisis
crisisThe Mexican Peso Crisis 1994
Globalization Project Report
Report submitted by: Akanksha Agrawal Namit Agrawal Saurabh Harkauli Apurv Jain Gaurav Jain Nikhil
Jaiswal Ahamed Moidu Tushar Pandey D001 D002 D021 D023 D025 D028 D039 D046
The Mexican Peso Crisis – 1994
CONTENTS S. No. Topic
1 2 3 4 5 6 7 8 9 10 11 12 13 Introduction Political Turmoil 1993 – 1994 Scenario In Mexico Foreign Capital
Inflow Sterilization Intervention Conversion Of Cetes To Tesobonos Dealing With The Crisis The December
Mistake Bailout & Performance Since Crisis Tequila Effect – Brazil And Argentina Current Situation Conclusion
References
Pg. No.
3 3 4 6 6 7 8 10 10 11 11 12 13
Page 2
INTRODUCTION
In the ... Show more content on Helpwriting.net ...
Over the next couple of weeks Mexico's reserves dropped nearly $4 billion, to $121⁄2 billion. The reasons for
renewed pressure on the peso in mid–December are unclear. Banco de Mexico cites several factors,  the
negative effects of higher real interest rates on financial intermediaries and debtors,  market worries that the
current account deficit would be difficult to finance in 1995,  a breakdown in negotiations with the rebels in
Chiapas. It is also possible that leaked rumors of changes in exchange rate policy set off another round of capital
flight. In any event, over three days Mexico lost another $1.5 billion in reserves.
SCENARIO IN MEXICO
Despite its good fiscal situation, Mexico had a substantial current account deficit during the early 1990s, and
some observers believed this deficit indicated that the peso needed to be devalued.
Page 4
The Mexican government and others insisted that the current account deficit was not a concern because it was
caused by a private capital inflow that was financing investment spending, not by fiscal deficits or excessive

Essay On Dow Chemical Company
rP os t
9–204–021
REV: MARCH 31, 2006
MIHIR A. DESAI
Dow Chemical's Bid for the Privatization of PBB in
Argentina
op yo On November 10, 1995, Oscar Vignart, vice president of business development for Latin America for Dow
Chemical Company (Dow), and Luis Marcer, CFO of Dow Química Argentina, considered the bidding price on
Petroquímica Bahia Blanca S.A. (PBB), which was being privatized by the
Argentine government. PBB produced both ethylene and polyethylene. It was part of a petrochemical complex
located in Bahia Blanca, 700 kilometers south of the Argentine capital, Buenos
Aires.1 Vignart believed that the acquisition of PBB offered Dow a once–in–a–lifetime opportunity to become
the leading polyethylene player in Latin America.
tC ... Show more content on Helpwriting.net ...
A plant for cracking ethane was estimated to cost $400 million to $500 million, a plant for cracking naphtha
$1 billion.3 Roughly half of the world's ethylene plants, particularly those in gas–poor regions such as
Japan and Western Europe, utilized naphtha. Plants in gas–rich regions such as North America and the Middle
East more frequently employed ethane from natural gas streams.4
No
tC
Large plant sizes and the need for economies of scale rendered the ethylene industry highly capital intensive.
Consequently, capacity additions or reductions could significantly affect balance of supply and demand,
influencing capacity utilization rates, prices, and profit margins. Ethylene profitability was tightly linked to its
global operating rate. Among the investors in the ethylene business were oil companies, governments, pure
chemical companies, conglomerates, private investors, and joint ventures. According to UBS Warburg plc,
financial return objectives ranged from loss leader to zero return to beating the cost of capital. The loss leader or
zero–return player was often a government operator that was, directly or indirectly, financing capital–intensive
ethylene plants in order to stimulate downstream business. This was the case in Brazil, where the government
sponsored a "tripartite" model, in which private Brazilian capital, multinationals holding the technology, and the
government would each

How Did Margaret Thatcher Become Successful?
Margaret Thatcher is one of the most profound and famous Prime Ministers to have ever reigned over the United
Kingdom and is, to the present day, the only ever female Prime Minister to have reigned over the United
Kingdom. During her reign as Prime Minister, she cut social welfare programs, reduced the power of the trade
union and privatised certain industries. She made history during her reign as Prime Minister, however, a big
question that many of us ask is whether Margaret Thatcher was a success or a failure during her reign. This essay
is going to discuss that question on Thatcherism and look at the positives and negatives of Thatcherism and they
will be supported by strong and accurate sources ranging from books to online articles. The ... Show more
Unemployment was still very high across Britain and economic growth was uneven across regions which meant
that whole communities had lost their economic foundation. A statement made by the 53 year old singer Steven
Patrick Morrissey, after Baroness Thatcher had passed away on April 8 2013, said that "every move she made
was charged by negativity and that she destroyed the British manufacturing industry, she hated the miners, she
hated the arts and she hated the Irish Freedom Fighters." (Lachno, 2013). The title of the article was called
'Margaret Thatcher was 'barbaric' and 'a terror', says Morrissey' which demonstrates a lot of hate and negativity
that Morrissey had towards Margaret Thatcher and this is only one person we are talking about, and there were
probably many others who share the same views as Morrissey did. But what is striking is the fact that the 53 year
old singer only made this statement after Margaret Thatchers death and not while she was still alive or even while
she was Prime Minister. This could be seen by some as a cowardice or ill–hearted act from the 53 year old singer
towards Margaret Thatcher to announce this statement just 24 hours after her

Dividend and Topic
Chapter 14 Questions:
Topic: DIVIDENDS 1. Payments made out of a firm 's earnings to its owners in the form of cash or stock are
called: A) Dividends. B) Distributions. C) Share repurchases. D) Payments–in–kind. E) Stock splits.
Answer: A
Topic: REGULAR CASH DIVIDENDS 2. A cash payment made by a firm to its owners in the normal course of
business is called a: A) Share repurchase. B) Liquidating dividend. C) Regular cash dividend. D) Special
dividend. E) Extra cash dividend.
Answer: C
Topic: SPECIAL DIVIDENDS 3. A cash payment made by a firm to its owners as a result of a one–time event is
called a: A) Share repurchase. B) Liquidating dividend. C) Regular cash dividend. ... Show more content on
Helpwriting.net ...
A) stock B) normal C) special D) extra E) liquidating
Answer: A
Topic: STOCK SPLITS 15. An increase in the firm 's number of shares outstanding without any change in
owners ' equity is called a _______________. A) special dividend B) stock split C) share repurchase D) tender
offer E) liquidating dividend
Answer: B
Topic: TRADING RANGE 18. The difference between the highest and lowest prices at which a stock has traded
is called its: A) Average price. B) Bid–ask spread. C) Trading range. D) Opening price. E) Closing price.
Answer: C
Topic: REVERSE SPLITS 16. In a reverse stock split, __________________________. A) the number of shares
outstanding increases, and owners ' equity decreases B) the firm buys back existing shares of stock on the open
market C) the firm sells new shares of stock on the open market D) the number of shares outstanding decreases,
but owners ' equity is unchanged E) shareholders make a cash payment to the firm, just the opposite of a cash
dividend
Answer: D
Topic: REGULAR CASH DIVIDEND 17. All else the same, which of the following is a possible consequence of
the firm making a regular cash dividend payment? A) The cash account decreases. B) The additional paid–in
capital account decreases. C) The common stock (par value) account decreases. D) The stock price declines by
the amount of the

Analysis of Argentinean Debt Crisis: IMF and Government...
The Argentina debt affected the country between the late 90's to the early 2000's and can be attributed to
misdiagnosis and ineffective policy. During this time the IMF and Argetina's government worked closely
together. Previous to the crisis Argentina had been celebrated for its economic policies and growth. The
government worked to put in place conservative economic policy, including the privatization of companies,
looser trade regulations, among other conservative changes. Economic growth in that period appears to have been
in large part the result of increasing amount of international debt. Before the end of the 90's, things began to fall
apart. The crisis can be traced back to the 80's, where the country experienced extreme ... Show more content on
Helpwriting.net ...
Argentina had difficulties in their ability to shoulder debt so large. For example, Argentina had less capacity to
raise tax revenue than industrial countries. Simultaneously the inflow of dollars decreased, lessening the money
supply even more, this was do in large part to external factors. It was more vulnerable to external shocks, which
in turn lead to low export–to–GDP ratio (Krueger 2002). For example, the US dollar appreciated against other
currencies, which caused the peso also to appreciate; this resulted in weakening of demand for Argentine exports
(Nataraj & Sahoo 2003). A non–competitive economy and international debt all lead to a balance of payments
crisis. The 2001 the Argentine recession grew rapidly deeper. The IMF gave additional funds, on the condition
that the government would eliminate its budget deficit. Yet, in doing so, the government was cutting most social
programmes. The government announced that it would cut the salaries of public employees by 20% and reduce
pension payments. Simultaneously, the worsening crisis raised fears the peso would devalue and the government
attempted to prevent people from trading their pesos for dollars (SOURCE). The currency board rules ensured
that as individuals began to convert their pesos into dollars, the central bank would shrink the money supply
causing interest rates to rise sharply (Source). Before the central bank ran out of dollars, the interest rates on peso
deposits would get so

Argentina: The Collapse of the Currency Board
Argentina is a large Latin American country located in the southern portion of South America. It is the second
largest South American country, and it is bordered by the Atlantic Ocean, Bolivia, Brazil, Chile, Paraguay, and
Uruguay (Nations Online, n.d.). The country gained its independence from Spain in 1816, maintains a republic
government, and, as of 2010, had a population of approximately 40 million (Nations Online, n.d.). It boasts a
strong tourist trade as well as exportation to the U.S. of goods such as wine, aluminum, and preserved foods
(U.S. Department of State, 2013b). In addition to exports and imports between the countries, the U.S. and
Argentina have several bilateral agreements including an investment treaty and a modernized civil aviation
agreement (U.S. Department of State, 2013b). Furthermore, the U.S. makes direct investments in Argentina and
is one of Argentina's largest trading partners (U.S. Department of State, 2013b). Nevertheless, Argentina is oft
considered to be an emerging market, never having gained a solid foothold in the world markets. Argentina's
growth position over the past decade has come at the heels of some significant failings in its monetary policies
and an extended recessionary period where its currency was devalued significantly (Eiteman, Stonehill, &
Moffett, 2010). The climax of the crisis faced by Argentina occurred in early 2002, when after an extended period
of recession and political and economic unrest, its decade–long

International Monetary Fund
The IMF's primary purpose is to ensure the stability of the international monetary system–the system of exchange
rates and international payments that enables countries (and their citizens) to transact with one other. This system
is essential for promoting sustainable economic growth, increasing living standards, and reducing poverty. The
Fund's mandate has recently been clarified and updated to cover the full range of macroeconomic and financial
sector issues that bear on global stability. The IMF was established at the Bretton Woods conference in 1944 to
provide short term financial assistance to countries experiencing problems with their trade deficit or other
Balance of Payments issues, so they could maintain stability in exchange ... Show more content on
Helpwriting.net ...
The IMF Board of Governors is composed of representatives of the 185 member countries. The Executive Board
has 24 members that usually represent a coalition of like–minded countries in one representative. Lending
decisions are made with consensus in a simple majority vote. Structural decisions require 60% majority where,
G–5 countries collectively can nearly veto since they currently have 38% vote. Fundamental structural decisions
e.g. changes in voting power require 85% majority; US has enough voting power to veto (>15%). Economic
nationalists would say that the IMF voting structure enables powerful countries to promote their own national
interests. Structuralists would say rich capitalist countries have the most voting power which is to the detriment
of the developing countries. Embedded liberals would say that the type of conditions IMF imposes and the aid it
provides helps troubled countries get back on track, stimulates their economy and gets the trade balance in
equilibrium. In December 1997 the IMF announced a $57 billion loan package to bail South Korea out of its
financial crisis accompanied by strict conditions. Some short term conditions were to reduce government
spending, increase taxes and raise interest rates. Longer term structural reforms were also mandated: liberalizing
foreign investment policies, opening domestic financial markets, implementing western lending standards,
closing insolvent banks, reforming labor laws and reducing import

Argentina Crisis Of Argentina 's Emerging Economy

Table of Contents
Introduction
Argentina before its Great Depression of 1998–2002.......................................1
Stages of a financial crisis of Argentina's emerging economy
Initiation of the crisis................................................................................2
Currency crisis.........................................................................................5
Full fledged financial crisis........................................................................8
Results...........................................................................................................9
Closing Remarks .............................................................................................10
Introduction
Argentina before its Great Depression in 1998–2002
Prior to becoming a democratic country, Argentina was exposed to a military dictatorship. Under this regime the
Economy Minister was Jose Alfredo Martinez de Hoz whose neoliberal economic platform sided along to anti–
labor, monetarist policies and financial liberalization. As a result of this regime, Argentina accumulated a $45
billion foreign debt. This lead interest rates to exceed trade surpluses, unemployment to increase and higher
inflation rates. In 1985 a democracy was reestablished once President Raul Alfonsin was elected. Alfonsin's
government intended to stabilize the economy by establishing the austral, a new currency. However, this was
unsuccessful because the government could not continue to fund its debts. The cost of utility increased
significantly as real wages fell by almost half, increasing uncertainty across the country and causing inflation to
increase from "200% a year in 1988 to 5,000% in 1989" (Brooke).
However, the economy improved once elected

Multinational Business Finance Chatper One Qestion Answer
End–of–Chapter Question Solutions 1
____________________________________________________________________________________________
CHAPTER 2: THE INTERNATIONAL MONETARY SYSTEM 1. The gold standard and the money supply.
Under the gold standard all national governments promised to follow the "rules of the game". This meant
defending a fixed exchange rate. What did this promise imply about a country's money supply? A country's
money supply was limited to the amount of gold held by its central bank or treasury. For example, if a country
had 1,000,000 ounces of gold and its fixed rate of exchange was 100 local currency units per ounce of gold, that
country could have 100,000,000 local currency units outstanding. Any change in its holdings of ... Show more
dollar. In dollarization, the country abolishes its own currency and uses a foreign currency, such as the U.S.
dollar, for all domestic transactions. 6. Emerging market exchange rate regimes. High capital mobility is forcing
emerging market nations to choose between free–floating regimes and currency board or dollarization regimes.
What are the main outcomes of each of these regimes from the perspective of emerging market nations? There is
no doubt that for many emerging markets a currency board, dollarization, and freely–floating exchange rate
regimes are all extremes. In fact, many experts feel that the global financial marketplace will drive more and
more emerging market nations towards one of these extremes. As illustrated by Exhibit 2.5, there is a distinct lack
of "middle ground" left between rigidly fixed and freely floating. In anecdotal support of this argument, a poll of
the general population in Mexico in 1999 indicated that 9 out of 10 people would prefer dollarization over a
floating–rate peso. Clearly, there are many in the emerging markets of the world who have little faith in their
leadership and institutions to implement an effective exchange rate policy. Exhibit 2.5 The Currency Regime
Choices for Emerging Markets High capital mobility is forcing emerging market nations to choose between two
extremes Emerging Market Country

Essay on A Plan for the Resolution of the Argentine Debt...
A Plan for the Resolution of the Argentine Debt Crisis
INTRODUCTION:
Over the past five years Argentina has suffered from one of the worst economic crises of its history. Mired by
currency devaluation, diminished business confidence, contracting GDP, and a large current accounts deficit, the
Argentine economy is, at very best, weak. Of its problems, Argentina's international debt is of greatest concern.
Servicing the debt has created a large financial burden for the Argentine government limiting the steps it has been
able to take to stimulate economic growth. Since temporarily stopping payment on US$132 billion of debt in
2001 , Argentina has experienced some economic expansion, but this growth has come with large costs. ... Show
more content on Helpwriting.net ...
These policies will work to support Argentina in its write–down negotiations with creditors. Commitment to
fiscal and trade reform, combined with a strong peso, will reduce uncertainty about the creditworthiness of
Argentina and will restart the process of long–run economic growth.
DEBT HISTORY:
Argentina's trouble with debt began with a military coup d'etat in 1976. The "Regime", as the military
government was called, ruled for seven years, during which it drastically increased the country's public debt.
When the Regime was overthrown, what was a reasonable $7.8 billion foreign debt had become a $46 billion
debt. Much of this increase can be attributed to the nationalization of loan debts owed by private companies.
Repayment of these debts became the responsibility of the Argentine people, who had neither approved nor
benefited from the loans. The illegally inherited debt left the newly elected government with the dilemma of
having to stimulate a troubled economy while devoting a significant portion of GDP to servicing the debt.
Argentina's debt problem was worsened in 1991 when the Argentine government passed the Convertibility Law
and pegged the peso to the U.S. dollar. From that point on all loans granted to Argentina were dollar–
denominated. This proved to have a detrimental effect on the level of debt when, in 2001, the

The Mexican Peso Crisis
crisisThe Mexican Peso Crisis 1994
Globalization Project Report
Report submitted by: Akanksha Agrawal Namit Agrawal Saurabh Harkauli Apurv Jain Gaurav Jain Nikhil
Jaiswal Ahamed Moidu Tushar Pandey D001 D002 D021 D023 D025 D028 D039 D046
CONTENTS S. No. Topic
1 2 3 4 5 6 7 8 9 10 11 12 13 Introduction Political Turmoil 1993 – 1994 Scenario In Mexico Foreign Capital
Inflow Sterilization Intervention Conversion Of Cetes To Tesobonos Dealing With The Crisis The December
Mistake Bailout & Performance Since Crisis Tequila Effect – Brazil And Argentina Current Situation Conclusion
References
Pg. No.
3 3 4 6 6 7 8 10 10 11 11 12 13
Page 2
INTRODUCTION
In the early 1990s the ... Show more content on Helpwriting.net ...
3. The largest form of capital inflow was the purchase of bonds–in many cases, government bonds. Over the
five–year period $43 billion came into Mexico for this purpose. A large portion of these securities had short
terms, often maturing in one to three months. Of the three forms of capital inflow, this last one probably posed
the greatest danger to the exchange rate peg. If anything caused foreign investors to decide to pull out of Mexico
(with its quasi–fixed exchange rate), investors could simply have taken their money out of the country as their
securities matured, putting tremendous pressure on the government's reserves within a matter of weeks.
STERILIZATION INTERVENTION
Even as the current account deficit widened, the growth of Mexico's reserves reinforced the government's false
sense of security, at least until early 1994. During the period of large capital inflows (1990–93), the central bank
accumulated international reserves while reducing domestic credit–that is, peso–denominated loans or grants to
the government or the banking system. This policy, called sterilizing, prevents the central
Page 6

bank's purchases of international reserves from raising the monetary base and expanding the money supply. To
sterilize a capital inflow, the central bank matches its

Argentina Crisis Of Argentina 's Emerging Economy
Table of Contents
Introduction
Argentina before its Great Depression of 1998–2002.......................................1
Stages of a financial crisis of Argentina's emerging economy
Initiation of the crisis................................................................................2
Currency crisis.........................................................................................4
Full fledged financial crisis........................................................................6
Results...........................................................................................................6
Closing Remarks ..............................................................................................6
Introduction
Argentina before its Great Depression in 1998–2002
Prior to becoming a democratic country, Argentina was exposed to a military dictatorship. Under this regime the
Economy Minister was Jose Alfredo Martinez de Hoz whose neoliberal economic platform sided along to anti–
labor, monetarist policies and financial liberalization. As a result of this regime, Argentina accumulated a $45
billion foreign debt. As a result interest rates exceeded trade surpluses, unemployment increased and there were
high inflation rates. In 1985 a democracy was reestablished once President Raul Alfonsin was elected. Alfonsin's
government intended to stabilize the economy by establishing the austral, a new currency. However, this was
unsuccessful because the government couldn't continue to fund its debts. The cost of utility increased
significantly as real wages fell by almost half. As a result uncertainty increased across the country, inflation
increased from 200% a year in 1988 to 5,000% in 1989 (Brooke).
However, the economy improved once elected President

Dollarization in Zimbabwe
Full Dollarization The Pros and Cons Andrew Berg, Eduardo Borensztein ©2000 International Monetary Fund
December 2000 [Preface] [The Pros and Cons of Full Dollarization] [Questions About Pegs] [The Appeal of
Dollarization] [The Risk Premium] [Seigniorage] [Stability] [Effect on Trade and Financial Links] [Exit Option]
[Lender of Last Resort Function and Financial System Stability] [Conclusions] [Author Information] Preface The
Economic Issues Series aims to make available to a broad readership of nonspecialists some of the economic
research being produced on topical issues by the International Monetary Fund. The series draws mainly from
IMF Working Papers, technical papers produced by IMF staff members and ... Show more content on
Helpwriting.net ...
| |Such informal dollarization is a response to economic instability and high inflation, and the desire of residents
to | |diversify and protect their assets from the risks of devaluation of their own currencies. It is useful to
distinguish | |between two motives for the demand for foreign currency assets: currency substitution and asset
substitution. | |In currency substitution foreign assets are used as money, essentially as means of payment and unit
of account, and it| |typically arises under conditions of high inflation or hyperinflation when the high cost of
using domestic currency | |for transactions prompts the public to look for available alternatives. Once the use of
foreign currency in | |transactions becomes accepted, it may not be rapidly abandoned. Remarkably, the increase
in dollarization in some | |Latin American and Asian countries has continued and accelerated in recent years even
following successful | |stabilization. | |Asset substitution results from risk and return considerations about
domestic and foreign assets. Historically, | |foreign currency–denominated assets have provided the opportunity
of insuring against macroeconomic risks, such

Finc415 Exam 1 Essays
Finance 415
Exam I
Review Questions
Suggestions 1) Read chapters 1 – 5 and review the PPTs we covered in class. 2) Expect 5 or 7 short–answer
questions
General Questions – 1. In class we reviewed three firms in three different countries. The M/S Milad Nor
Company in Afghanistan, Caritex in Bulgaria, and Obod in Montenegro. Each company was faced with different
problems and issues. Please briefly summarize the similarities between the firms and their individual issues. How
do the problems faced by these firms compare to problems faced by similar firms in more developed countries?
2. Your stock market simulation calls for you to invest in securities with a significant presence outside the US –
debt, equity, ... Show more content on Helpwriting.net ...
What are some of the typical causes of these failures in corporate governance?p34
10. Do markets appear to be willing to pay for good governance?p36
Chapter 3
1. Under the gold standard all national governments promised to follow the "rules of the game." This meant
defending a fixed exchange rate. What did this promise imply about a country's money supply?
2. If a country follows a fixed exchange rate regime, what macroeconomic variables could cause the fixed
exchange rate to be devalued?
3. What are the advantages and disadvantages of fixed exchange rates?
4. Explain what is meant by the term impossible trinity and why it is true.
5. Fixed exchange rate regimes are sometimes implemented through a currency board (Hong Kong) or
dollarization (Ecuador). What is the difference between the two approaches?
6. High capital mobility is forcing emerging market nations to choose between free–floating regimes and
currency board or dollarization regimes. What are the main outcomes of each of these regimes from the
perspective of emerging market nations?
7. On January 4, 1999, eleven member states of the European Union initiated the European Monetary Union
(EMU) and established a single currency, the euro, which replaced the individual currencies of participating
member states. Describe three of the main ways that the euro affects the members of the EMU.
8. Why did the fixed exchange rate regime of 1945–1973 eventually fail?
9. How

The Financial And Banking System
The Financial and Banking System of:
Argentina
Presented
In Partial Fulfillments of the
Course Requirements for FIN 4634
International Banking
Prepared for:
Marcos A. Kerbel
Participating Adjunct Professor
Department of Finance & Real Estate
Florida International University
Miami, Florida
Prepared by:
Frias, Justin
Panther ID 4929265 954–701–6898 Jfria012@fiu.edu
Date of Report
07/ 28/ 2015
The Financial and Banking System of:
Argentina
I. Table of Contents Insert Applicable Page Nos.
Geography
Argentina is a country located in southern South America (or Southern Cone). It is bordered by the Andes in the
west and the South Atlantic Ocean to the east, neighboring countries are Chile to the west, Bolivia and Paraguay
to the north, and Brazil and Uruguay to the northeast. Argentina is the second largest country of South America
after Brazil, and the 8th largest country in the world. Its total area is approximately 2.7 million km². Argentina
claims a section of Antarctica (Argentine Antarctica) but has agreed to suspend sovereignty disputes in the region
as a signatory to the Antarctic Treaty. Argentina also asserts claims to several South Atlantic islands administered
by the United Kingdom. With a population of more than 42.1 million, Argentina ranks as the world 's 32nd most
populous country as of 2010.
History of Argentina
The history of Argentina is divided by historians into four main

International Business Management Research Paper

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