Butler - Multinational finance: evaluating opportunities, costs, and risks of multinational operations

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Copyright 2016 by Kirt C. Butler. All rights reserved.

Published by John Wiley & Sons, Inc., Hoboken, New Jersey.

First, Second, and Third Editions published by South-Western Pub in 1996, 1999, 2003. Fourth Edition published by Wiley-Blackwell in 2008. Fifth Edition published by John Wiley & Sons, Inc. in 2012.

Published simultaneously in Canada.

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Library of Congress Cataloging-in-Publication Data:

Names: Butler, Kirt Charles, author.

Title: Multinational finance : evaluating opportunities, costs, and risks of multinational operations / Kirt C. Butler.

Description: Sixth edition. | Hoboken, New Jersey : John Wiley & Sons, Inc., 2016 | Includes bibliographical references and index.

Identifiers: LCCN 2015047252 (print) | LCCN 2016003024 (ebook) | ISBN 9781119219682 (pbk. : alk. paper) | ISBN 9781119219705 (ePub) | ISBN 9781119219712 (Adobe PDF)

Subjects: LCSH: International business enterprisesFinance. | Foreign exchange. | International finance.

Classification: LCC HG4027.5 .B88 2016 (print) | LCC HG4027.5 (ebook) | DDC 658.15/99dc23

LC record available at http://lccn.loc.gov/2015047252

Cover Design: Wiley

Cover Image: Skyscrapers Fotoluminate LLC/Shutterstock

Albert Einstein

Multinational Finance assumes the viewpoint of the financial manager of a multinational enterprise with operations in more than one country. The enterprise could be a multinational corporation, a large financial institution, or a small partnership or proprietorship. The book provides a framework for evaluating the many opportunities, costs, and risks of multinational operations in a manner that allows readers to see beyond the algebra and terminology to general principles. The text is organized into five parts:

• on currency and Eurocurrency markets are necessary prerequisites for most of the chapters that follow.
• cover currency derivativesfutures, options, and swapsbecause of the importance of these derivative instruments in financial risk management.
• : Managing the Risks of Multinational Operations. Part III covers the multinational treasury and the multinational corporation's management of transaction, operating, and translation exposures to currency risk.
• on cross-border capital budgeting has far more depth than competing texts, covering the international parity case as well as disequilibrium situations in which the international parity conditions do not hold. Additional chapters cover country risk, multinational financing, taxation, real option valuation, and corporate governance.
• : International Portfolio Investment and Asset Pricing. The text supplements the multinational corporate finance material in earlier chapters with separate chapters on international capital markets, portfolio diversification, and asset pricing.

Readers with an interest in corporate finance will find that provides a rich insight into investors' required returns and the corporation's cost of capital.

This edition of Multinational Finance retains the classic features developed in earlier editions, as well as new material on topics of interest to practitioners.

• Comprehensive and up-to-date coverage of traditional topics. Intended for advanced undergraduate and MBA classes in international financial management, the text requires only a single preparatory course in finance. Chapters that extend material from the first course begin with a brief review of the fundamentals. Numerous graphs and figures assist the reader in understanding key financial concepts and techniques. Real-world updates, applications, and examples are used to illustrate how the financial concepts and techniques are used in practice. Advanced material is placed in chapter appendices, so that study can be tailored to each individual's objectives.
• Distinctive chapters on key topics. Distinctive chapters are devoted to topics of special interest to practitioners of multinational finance.
  • provide detailed treatments of futures, options, and swaps. These specialized chapters are appropriate for students desiring a deep understanding of the financial tools available for currency risk management.
  • Appendix 8A develops the valuation consequences of currency risk management for the firm's stakeholders. This allows a deeper understanding of the motives of the firm's stakeholders in managing currency risks.
  • takes a real options approach to valuing flexibility in cross-border investments.
  • describes differences in national corporate governance systems and their implications for the international market for corporate control. The chapter provides a survey of the rich and ongoing academic research into corporate governance and corporate control.