Difference Between Domestic And International Finance

2672 Words May 13th, 2015 11 Pages
Nowadays, our way of life is much globalized and we have a unified economy throughout the world. In this highly globalized world, there are major economic functions that are happening today, such as, production, investment, and consumptions. There is definitely a difference between domestic and international finance. The reason why domestic and international finance are different is because of foreign exchange rates, political risks, market imperfections, and the expanded opportunities. The foreign exchange rate risk can influence the way countries import and export with other foreign countries. As well as, the lending and borrowing interest rate from other countries can also influence the import/export strategy. Political risk is when a country can change certain laws in their own country or other countries that forbid certain trade. The imperfect market is the only kind of market that really exists because there isn’t a perfect market. In this paper, I will be addressing what globalization means, what multinational corporations mean, the major trends and developments of globalization in the world and how it changed MNCs over time, how globalization has changed the multinational corporations (MNCs), and lastly examples of Wall Street Journals to help support why globalization has changed MNCs.
In order to answer the question of how globalization has changed Multinational Corporation’s financial management, we first need to understand…
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