Economics Homework Help

Part A

Political risks may be faced by companies when investing internationally, research a recent example of political risk that a US company was exposed to.

In this section, identify the events leading up to the political risk you researched and describe the end result. Explain how this kind of risk would affect potential international operations, and develop a plan for how you would mitigate the risk associated with a similar situation. This section should include references from scholarly sources and be no less than 300 words.

Part B

This section will cover various restrictions on equity ownership by foreigners. Review the Investing Across Borders 2010 (Links to an external site.) document, and conduct some independent research on restrictions on foreign equity ownership for United Kingdom.

In your answer, report your findings and examine how the restrictions might hinder international operations. Devise a strategy for how you might restructure your acquisition target to meet all ownership restrictions. This section should include references from scholarly sources and be no less than 300 words.

Part C

In your initial post, use the stock market index for your selected country for the ACME acquisition (The Financial Times Stock Exchange 100 Index or FTSE) to solve for the optimal international portfolio.

Assess the potential gains from holding an optimal international portfolio, citing the information from the portfolio and the Sharpe ratio to justify your recommendation to ACME. Illustrate how the portfolio could provide ACME the maximum return based on the amount of risk they are willing to incur. This section should include references from scholarly sources and be no less than 350 words.