mini-case-business-finance-答案

第四辑解析首先得搞明白的是这篇文章到底讲的什么。

不用看具体内容，有两个地方直接告诉了。

一个是题目说明的第一句话，另一个是正文的标题。

从这两个地方就可以看出全文探讨的是公司未来接班人——也就是潜力股——的培养问题。

A段讲了TLRG这个贯穿全文的研究组织诞生的原因：现行的研究满足不了需要，于是大多数公司只能自己探索发掘接班人的模式；（即第五题的答案）B段讲了直属经理（line managers）对于发掘接班人的重要性（真是干什么都要从基层抓起），以及经理们的一些疑虑；C段讲的是接班人问题对公司的重要性，并且应该让院线经理们明白这种重要性；D段是针对前面列出的问题，提出的解决建议，什么专家协助等等。

整篇文章分为四个部分，层层递进，有很强的逻辑性。

拿这样的文章来做阅读材料应该是相对容易把握的。

题目解析：图中蓝色的线为答案潜伏的地方。

7个题干基本是将原文中的句子用另外的词语和句型表述出来，所以题干中的关键词都能在正文里找到与之匹配的，比如第四题题干里的expert对应D段的specialists,第六题的too busy to对应于B 段里的heavy workloads，第七题的interest对应于C段的appeal。

第一题说“经理们必须采取措施使潜力股们相信他们对公司的价值”，也就是要让潜力股们对公司忠诚，即C段说的creating “attraction centres”和loyalty。

第二题说“组织必须把目光投向正在培养中的潜力股以外的地方”，即D段最后两句话所说的寻找新一代的潜力股。

第三题和B段的最后一句话完全是一个意思：怕培养潜力股的投入收不回成本。

第四题说开发潜力股，经理们需要在公司内部得到专家支持。

答案是D段的第一句话：公司的人力资源专家需要采取行动。

HR specialists就是expert。

第五题说公司现在没有在指导策略的支持下辨别潜力股。

也就是说公司是依靠自己来发掘人才的。

答案是A段的第一句：现行的研究满足不了需要，所以公司只能形成自己的一套体系。

米什金货币金融学英文版习题答案chapter14英文习题Economics of Money, Banking, and Financial Markets, 11e, Global Edition (Mishkin) Chapter 14 Central Banks: A Global Perspective14.1 Origins of the Federal Reserve System1) The First Bank of the United StatesA) was disbanded in 1811 when its charter was not renewed.B) had its charter renewal vetoed in 1832.C) was fundamental in helping the Federal Government finance the War of 1812.D) None of the above.Answer: AAACSB: Reflective Thinking2) The Second Bank of the United StatesA) was disbanded in 1811 when its charter was not renewed.B) had its charter renewal vetoed in 1832.C) is considered to be the primary cause of the bank panic of 1907.D) None of the above.Answer: BAACSB: Reflective Thinking3) The public's fear of centralized power and distrust of moneyed interests led to the demise of the first two experiments in central banking, otherwise known asA) the First Bank of the United States and the Second Bank of the United States.B) the First Bank of the United States and the Central Bank of the United States.C) the First Central Bank of the United States and the SecondCentral Bank of the United States.D) the First Bank of North America and the Second Bank of North America.Answer: AAACSB: Reflective Thinking4) The financial panic of 1907 resulted in such widespread bank failures and substantial losses to depositors that the American public finally became convinced thatA) the First Bank of the United States had failed to serve as a lender of last resort.B) the Second Bank of the United States had failed to serve as a lender of last resort.C) the Federal Reserve System had failed to serve as a lender of last resort.D) a central bank was needed to prevent future panics.Answer: DAACSB: Reflective Thinking5) What makes the Federal Reserve so unique compared to other central banks around the world is itsA) centralized structure.B) decentralized structure.C) regulatory functions.D) monetary policy functions.Answer: BAACSB: Reflective Thinking14.2 Structure of the Federal Reserve System1) Which of the following is NOT an entity of the Federal Reserve System?A) Federal Reserve BanksB) the Comptroller of the CurrencyC) the Board of GovernorsD) the Federal Open Market CommitteeAnswer: BAACSB: Reflective Thinking2) Which of the following is an entity of the Federal Reserve System?A) the U.S. Treasury SecretaryB) the FOMCC) the Comptroller of the CurrencyD) the FDICAnswer: BAACSB: Reflective Thinking3) The three largest Federal Reserve banks (New York, Chicago, and San Francisco) combined hold more than ________ percent of the assets of the Federal Reserve System.A) 25B) 33C) 50D) 67Answer: CAACSB: Analytical Thinking4) The Federal Reserve Banks are ________ institutions since they are owned by the ________.A) quasi-public; private commercial banks in the district where the Reserve Bank is locatedB) public; private commercial banks in the district where the Reserve Bank is locatedC) quasi-public; Board of GovernorsD) public; Board of GovernorsAnswer: AAACSB: Reflective Thinking5) Each Federal Reserve bank has nine directors. Of these ________ are appointed by the member banks and ________ are appointed by the Board of Governors.A) three; sixB) four; fiveC) five; fourD) six; threeAnswer: DAACSB: Reflective Thinking6) The nine directors of the Federal Reserve Banks are split into three categories: ________ are professional bankers, ________ are leaders from industry, and ________ are to represent the public interest and are not allowed to be officers, employees, or stockholders of banks.A) 5; 2; 2B) 2; 5; 2C) 4; 2; 3D) 3; 3; 3Answer: DAACSB: Reflective Thinking7) Member commercial banks have purchased stock in their district Fed banks; the dividend paid by that stock is limited by law to ________ percent annually.A) fourB) fiveC) sixD) eightAnswer: CAACSB: Reflective Thinking8) The Federal Reserve Bank of ________ houses the open market desk.A) BostonB) New YorkC) ChicagoD) San FranciscoAnswer: BAACSB: Reflective Thinking9) The president from which Federal Reserve Bank always hasa vote in the Federal Open Market Committee?A) PhiladelphiaB) BostonC) San FranciscoD) New YorkAnswer: DAACSB: Reflective Thinking10) An important function of the regional Federal Reserve Banks isA) setting reserve requirements.B) clearing checks.C) determining monetary policy.D) setting margin requirements.Answer: BAACSB: Reflective Thinking11) Which of the following functions is NOT performed by any of the twelve regional Federal Reserve Banks?A) check clearingB) conducting economic researchC) setting interest rates payable on time depositsD) issuing new currencyAnswer: CAACSB: Reflective Thinking12) All ________ are required to be members of the Fed.A) state chartered banksB) national banks chartered by the Office of the Comptroller of the CurrencyC) banks with assets less than $100 millionD) banks with assets less than $500 millionAnswer: BAACSB: Reflective Thinking13) Of all commercial banks, about ________ belong to the Federal Reserve System.A) 10%B) one halfC) one thirdD) 90%Answer: CAACSB: Reflective Thinking14) Prior to 1980, member banks left the Federal Reserve System due toA) the high cost of discount loans.B) the high cost of required reserves.C) a desire to avoid interest rate regulations.D) a desire to avoid credit controls.Answer: BAACSB: Reflective Thinking15) The Fed's support of the Depository Institutions Deregulation and Monetary Control Act of 1980 stemmed in part from itsA) concern over declining Fed membership.B) belief that all banking regulations should be eliminated.C) belief that interest rate ceilings were too high.D) belief that depositors had to become more knowledgeable of banking operations. Answer: AAACSB: Reflective Thinking16) Banks subject to reserve requirements set by the Federal Reserve System includeA) only nationally chartered banks.B) only banks with assets less than $100 million.C) only banks with assets less than $500 million.D) all banks whether or not they are members of the Federal Reserve System.Answer: DAACSB: Reflective Thinking17) The Depository Institutions Deregulation and Monetary Control Act of 1980A) established higher reserve requirements for nonmember than for member banks.B) established higher reserve requirements for member than for nonmember banks.C) abolished reserve requirements.D) established uniform reserve requirements for all banks.Answer: DAACSB: Reflective Thinking18) There are ________ members of the Board of Governors of the Federal Reserve System.A) 5B) 7C) 12D) 19Answer: BAACSB: Reflective Thinking19) Members of the Board of Governors areA) chosen by the Federal Reserve Bank presidents.B) appointed by the newly elected president of the United States, as are cabinet positions.C) appointed by the president of the United States and confirmed by the Senate.D) never allowed to serve more than 7-year terms.Answer: CAACSB: Reflective Thinking20) Each governor on the Board of Governors can serveA) only one nonrenewable fourteen-year term.B) one full nonrenewable fourteen-year term plus part of another term.C) only one nonrenewable eight-year term.D) one full nonrenewable eight-year term plus part of another term.Answer: BAACSB: Reflective Thinking21) The Chairman of the Board of Governors is chosen from among the seven governors and serves a ________, renewable term.A) one-yearB) two-yearC) four-yearD) eight-yearAnswer: CAACSB: Reflective Thinking22) While the discount rate is "established" by the regionalFederal Reserve Banks, in truth, the rate is determined byA) Congress.B) the president of the United States.C) the Senate.D) the Board of Governors.Answer: DAACSB: Reflective Thinking23) Which of the followings is a duty of the Board of Governors of the Federal Reserve System?A) setting margin requirements, the fraction of the purchase price of the securities that has to be paid for with cashB) setting the maximum interest rates payable on certain types of time deposits under Regulation QC) regulating credit with the approval of the president under the Credit Control Act of 1969D) All governors advise the president of the United States on economic policy.Answer: AAACSB: Reflective Thinking24) Which of the followings is NOT a current duty of the Board of Governors of the Federal Reserve System?A) setting margin requirements, the fraction of the purchase price of the securities that has to be paid for with cashB) setting the maximum interest rates payable on certain types of time deposits under Regulation QC) approving the discount rate "established" by the Federal Reserve banksD) voting on the conduct of open market operationsAnswer: BAACSB: Reflective Thinking25) The Federal Open Market Committee usually meets ________ times a year.A) fourB) sixC) eightD) twelveAnswer: CAACSB: Reflective Thinking26) The Federal Reserve entity that makes decisions regarding the conduct of open market operations is theA) Board of Governors.B) chairman of the Board of Governors.C) Federal Open Market Committee.D) Open Market Advisory CouncilAnswer: CAACSB: Reflective Thinking27) The Federal Open Market Committee consists of theA) five senior members of the seven-member Board of Governors.B) seven members of the Board of Governors and seven presidents of the regional Fed banks.C) seven members of the Board of Governors and five presidents of the regional Fed banks.D) twelve regional Fed bank presidents and the chairman of the Board of Governors. Answer: CAACSB: Reflective Thinking28) The majority of members of the Federal Open Market Committee areA) Federal Reserve Bank presidents.B) members of the Federal Advisory Council.C) presidents of member banks.D) the seven members of the Board of Governors.Answer: DAACSB: Reflective Thinking29) Each Fed bank president attends FOMC meetings; although only ________ Fed bank presidents vote on policy, all ________ provide input.A) three; tenB) five; tenC) three; twelveD) five; twelveAnswer: DAACSB: Reflective Thinking30) Although reserve requirements and the discount rate are not actually set by the ________, decisions concerning these policy tools are effectively made there.A) Federal Reserve Bank of New YorkB) Board of GovernorsC) Federal Open Market CommitteeD) Federal Reserve BanksAnswer: CAACSB: Reflective Thinking31) The research document given to the Federal Open Market Committee that contains information on the state of the economy in each Federal Reserve district is called theA) beige book.B) green book.C) blue book.D) black book.Answer: AAACSB: Reflective Thinking32) The teal book is the Fed research document containingA) the forecast of national economic variables for the next three years.B) forecasts of the money aggregates conditional on different monetary policy stances.C) information on the state of the economy in each Federal Reserve district.D) both A and B.E) A, B and C.Answer: DAACSB: Reflective Thinking33) The Federal Open Market Committee's "balance of risks" is an assessment of whether, in the future, its primary concern will beA) higher exchange rates or higher unemployment.B) higher inflation or a stronger economy.C) higher inflation or a weaker economy.D) lower inflation or a stronger economy.Answer: CAACSB: Reflective Thinking34) Subject to the approval of the Board of Governors, the decision of choosing the president ofa district Federal Reserve Bank is made byA) all nine district bank directors.B) the six district bank directors elected by the member banks.C) three district bank directors who are professional bankers.D) district bank directors who are not professional bankers.E) class A and class B directors.Answer: DAACSB: Ethical understanding and reasoning abilities35) Why does the Federal Reserve Bank of New York play a special role within the Federal Reserve System?Answer: The New York district contains the largest banks in the country. The New York Fed supervises and examines these banks to insure their soundness and the safety of the nation's financial system. The New York Fed conducts open market operations and foreign exchange transactions for the Fed and Treasury. The New York Fed belongs to the Bank for International Settlements, so its president and the chairman of the Board of Governors represent the U.S. at the monthly meetings of the world's central banks. The New York Fed president is the only president of a regional Fed who is a permanent voting member of the FOMC.AACSB: Reflective Thinking36) Who are the voting members of the Federal Open Market Committee and why is this committee important? Where does the power lie within this committee?Answer: The FOMC determines the monetary policy of the United States through its decisions about open market operations. It also effectively determines the discount rate and reserve requirements. The seven members of the Board of Governors, the president of the New York Fed, and four of the other eleven regional bank presidents are voting members on a rotating basis. Within the FOMC, the chairman of the Board of Governors wields the power.AACSB: Reflective Thinking14.3 How Independent is the Fed?1) Instrument independence is the ability of ________ to setmonetary policy ________.A) the central bank; goalsB) Congress; goalsC) Congress; instrumentsD) the central bank; instrumentsAnswer: DAACSB: Reflective Thinking2) The ability of a central bank to set monetary policy instruments isA) political independence.B) goal independence.C) policy independence.D) instrument independence.Answer: DAACSB: Reflective Thinking3) Goal independence is the ability of ________ to set monetary policy ________.A) the central bank; goalsB) Congress; goalsC) Congress; instrumentsD) the central bank; instrumentsAnswer: AAACSB: Reflective Thinking4) The ability of a central bank to set monetary policy goals isA) political independence.B) goal independence.C) policy independence.D) instrument independence.Answer: BAACSB: Reflective Thinking5) Members of Congress are able to influence monetary policy, albeit indirectly, through their ability toA) withhold appropriations from the Board of Governors.B) withhold appropriations from the Federal Open Market Committee.C) propose legislation that would force the Fed to submit budget requests to Congress, as must other government agencies.D) instruct the General Accounting Office to audit the foreign exchange market functions of the Federal Reserve.Answer: CAACSB: Reflective Thinking6) Explain two concepts of central bank independence. Is the Fed politically independent? Why do economists think central bank independence is important?Answer: Instrument independence is the ability of the central bank to set its instruments, and goal independence is the ability of a central bank to set its goals. The Fed enjoys both types of independence. The Fed is largely independent of political pressure due to its earnings and the conditions of appointment of the Board of Governors and its chairman. However, some political pressure can be applied through the threat or enactment of legislation affecting the Fed. Independence is important because there is some evidence that independent central banks pursue lower rates of inflation without harming overall economic performance.AACSB: Reflective Thinking14.4 Should the Fed be Independent?1) The case for Federal Reserve independence does NOTinclude the idea thatA) political pressure would impart an inflationary bias to monetary policy.B) a politically insulated Fed would be more concerned with long-run objectives and thus be a defender of a sound dollar and a stable price level.C) policy is always performed better by an elite group such as the Fed.D) a Federal Reserve under the control of Congress or the president might make the so-called political business cycle more pronounced.Answer: CAACSB: Reflective Thinking2) The political business cycle refers to the phenomenon that just before elections, politicians enact ________ policies. After the elections, the bad effects of these policies (for example, ________ ) have to be counteracted with ________ policies.A) expansionary; higher unemployment; contractionaryB) expansionary; a higher inflation rate; contractionaryC) contractionary; higher unemployment; expansionaryD) contractionary; a higher inflation rate; expansionaryAnswer: BAACSB: Analytical Thinking3) The strongest argument for an independent Federal Reserve rests on the view that subjecting the Fed to more political pressures would impartA) an inflationary bias to monetary policy.B) a deflationary bias to monetary policy.C) a disinflationary bias to monetary policy.D) a countercyclical bias to monetary policy.Answer: AAACSB: Ethical understanding and reasoning abilities4) Critics of the current system of Fed independence contend thatA) the current system is undemocratic.B) voters have too much say about monetary policy.C) the president has too much control over monetary policy on a day-to-day basis.D) the Board of Governors is held responsible for policy missteps.Answer: AAACSB: Diverse and multicultural work environments5) Recent research indicates that inflation performance (low inflation) has been found to be best in countries withA) the most independent central banks.B) political control of monetary policy.C) money financing of budget deficits.D) a policy of always keeping interest rates low.Answer: AAACSB: Reflective Thinking6) Make the case for and against an independent Federal Reserve.Answer: Case for: 1. An independent Federal Reserve can shield the economy from the political business cycle, and it will be less likely to have an inflationary bias to monetary policy.2. Control of the money supply is too important to leave to inexperienced politicians.Case against: 1. It is undemocratic to have monetary policy be controlled by a small number of individuals that are not accountable. 2. In the past, an independent Fed has not used itsfreedom wisely. 3. Its independence may encourage it to pursue its own self-interest rather than the public's interest.AACSB: Ethical understanding and reasoning abilities14.5 Explaining Central Bank Behavior1) The theory of bureaucratic behavior suggests that the objective of a bureaucracy is to maximizeA) the public's welfare.B) profits.C) its own welfare.D) conflict with the executive and legislative branches of government.Answer: CAACSB: Reflective Thinking2) The theory of bureaucratic behavior when applied to the Fed helps to explain why the FedA) was supportive of congressional attempts to limit the central bank's autonomy.B) was so secretive about the conduct of future monetary policy.C) sought less control over banks in the 1980s.D) was willing to take on powerful groups that may threaten its autonomy.Answer: BAACSB: Reflective Thinking3) What is the theory of bureaucratic behavior and how can it be used to explain the behavior of the Federal Reserve?Answer: The theory of bureaucratic behavior concludes that the main objective of any bureaucracy is to maximize its own welfare, which is related to power and prestige. This can explain why the Federal Reserve has defended its autonomy, avoidsconflict with Congress and the president, and its push to gain more control over banks.AACSB: Analytical Thinking14.6 Structure and Independence of the European Central Bank1) Under the European System of Central Banks, the Executive Board is similar in structure to the ________ of the Federal Reserve System.A) Board of GovernorsB) Federal Open Market CommitteeC) Federal Reserve BanksD) Federal Advisory CouncilAnswer: AAACSB: Reflective Thinking2) Under the European System of Central Banks, the Governing Council is similar in structure to the ________ of the Federal Reserve System.A) Board of GovernorsB) Federal Open Market CommitteeC) Federal Reserve BanksD) Federal Advisory CouncilAnswer: BAACSB: Reflective Thinking3) Under the European System of Central Banks, the National Central Banks have the same role as the ________ of the Federal Reserve System.A) Board of GovernorsB) Federal Open Market CommitteeC) Federal Reserve BanksD) Federal Advisory CouncilAnswer: CAACSB: Reflective Thinking4) Members of the Executive Board of the European System of Central Banks are appointed to ________ year, nonrenewable terms.A) fourB) eightC) tenD) fourteenAnswer: BAACSB: Reflective Thinking5) Which of the following statements comparing the European System of Central Banks and the Federal Reserve System is TRUE?A) The budgets of the Federal Reserve Banks are controlled by the Board of Governors, while the National Central Banks control their own budgets and the budget of the European Central Bank.B) The European Central Bank has similar power over the National Central Banks when compared to the level of power the Board of Governors has over the Federal Reserve Banks. C) Just like the Federal Reserve System, monetary operations are centralized in the European System of Central Banks with the European Central Bank.D) The European Central Bank's involvement in supervision and regulation of financial institutions is comparable to the Board of Governors' involvement.Answer: AAACSB: Reflective Thinking6) The Governing Council usually meets ________ times a year.A) fourB) sixC) eightD) twelveAnswer: DAACSB: Reflective Thinking7) In the Governing Council, the decision of what policy to implement is made byA) majority vote of the Executive Board members.B) majority vote of the heads of the National Banks.C) consensus.D) majority vote of all members of the Governing Council.Answer: CAACSB: Reflective Thinking8) The central bank which is generally regarded as the most independent in the world because its charter cannot be changed by legislation is theA) Bank of England.B) Bank of Canada.C) European Central Bank.D) Bank of Japan.Answer: CAACSB: Reflective Thinking9) Explain the similarities and differences between the European System of Central Banks andthe Federal Reserve System.Answer: The similarities between the two are in their structure. The National Central Banks of the member countries of the Eurosystem have the same role as the Federal Reserve Banks in the Federal Reserve System. The Executive Board and theGoverning Council of the Eurosystem resemble the Board of Governors and the Federal Open Market Committee of the Federal Reserve System, respectively. There are three major differences between the two. The first difference is concerning the control of the budgets. In the Fed, the Board of Governors controls the budgets of the Reserve Banks while in the Eurosystem, the National Banks control the budget of the European Central Bank. The second difference is the monetary operations of the Eurosystem are conducted by the National Banks, so they are not as centralized as the monetary operations in the Federal Reserve System. Finally, the European Central Bank is not involved in the supervision and regulation of the financial institutions in the euro zone while the Federal Reserve is involved with the regulation and supervision of the financial institutions in the United States.AACSB: Reflective Thinking14.7 Structure and Independence of Other Foreign Central Banks1) On paper, the Bank of Canada has ________ instrument independence and ________ goal independence when compared to the Federal Reserve System.A) less; lessB) less; moreC) more; lessD) more; moreAnswer: AAACSB: Reflective Thinking2) The oldest central bank, having been founded in 1694, is theA) Bank of England.B) Deutsche Bundesbank.C) Bank of Japan.D) Federal Reserve System.Answer: AAACSB: Reflective Thinking3) While legislation enacted in 1998 granted the Bank of Japan new powers and greater autonomy, its critics contend that its independence isA) limited by the Ministry of Finance's veto power over a portion of its budget.B) too great because it need not pursue a policy of price stability even if that is the popular will of the people.C) too great since the Ministry of Finance no longer has veto power over the bank's budget.D) limited since the Ministry of Finance can dismiss senior bank officials.Answer: AAACSB: Reflective Thinking4) Regarding central bank independenceA) the Fed is more independent than the European Central Bank.B) the European Central Bank is more independent than the Fed.C) the trend in industrialized nations has been to reduce central bank independence.D) the Bank of England has the longest tradition of independence of any central bank in the world.Answer: BAACSB: Reflective Thinking5) The trend in recent years is that more and moregovernmentsA) have been granting greater independence to their central banks.B) have been reducing the independence of their central banks to make them more accountable for poor economic performance.C) have mandated that their central banks focus on controlling inflation.D) have required their central banks to cooperate more with their Ministers of Finance. Answer: AAACSB: Reflective Thinking6) Which of the following statements about central bank structure and independence is TRUE?A) In recent years, with the exception of the Bank of England and the Bank of Japan, most countries have reduced the independence of their central banks, subjecting them to greater democratic control.B) Before the Bank of England was granted greater independence, the Federal Reserve was the most independent of the world's central banks.C) Both theory and experience suggest that more independent central banks produce better monetary policy.D) While the European Central Bank is independent, it is not as independent as the Federal Reserve.Answer: CAACSB: Reflective Thinking。

CHAPTER 1GLOBALIZATION AND THE MULTINATIONAL FIRMSUGGESTED ANSWERS TO END—OF-CHAPTER QUESTIONS QUESTIONS1 。

Why is it important to study international financial management？Answer: We are now living in a world where all the major economic functions, i.e.，consumption，production, and investment，are highly globalized. It is thus essential for financial managers to fully understand vital international dimensions of financial management. This global shift is in marked contrast to a situation that existed when the authors of this book were learning finance some twenty years ago. At that time, most professors customarily (and safely, to some extent) ignored international aspects of finance 。

This mode of operation has become untenable since then.2. How is international financial management different from domestic financial management？Answer ：There are three major dimensions that set apart international finance from domestic finance 。

Unit 1Business EthicsLead-in1.Discussion1)Ethics, also known as moral philosophy, is a branch of philosophy that involvessystematizing, defending, and recommending concepts of right and wrong conduct. In philosophy, ethics studies the moral behavior in humans, and how one should act.2)Ethics to consider in business:1) Ethics about business input:This involves ethics in gaining resources, forinstance purchasing equipments, r aising fund, recruiting staff…2) Ethics about business process:This involves ethical practice in R&D,production, administration, finance, marketing, HR management, logistics…3) Ethics about business output:This involves ethical practice in providingquality products, service, etc and dealing with waste properly and protecting environment.2.A Mini Case1)The local people claimed three things: a) There’s a decrease in the amount ofwater available to them and Coca-Cola was to blame; b) Their livelihood has been destroyed since the building of the plant; c) the number of people working on the land has dropped considerably.2)Coca-Cola claimed that its waste sludge was a useful fertilizer.3)Coca-Cola claimed that the reports were scurrilous. Its response was veryarrogant and offensive.Text AOnly the Ethical SurviveExercisesI.Reading Comprehension1.Determine whether the following statements are true or false based on theinformation you get from the text. Write a T for true, an F for false, and an NGfor not given.1) F 2) T 3) NG 4) T 5) T 6) NG 7) T 8) T2. Discuss the following questions with your partner.1)Management should be ethical in making decisions. Price reasonably. Do notexploit the labor force. Produce quality products. Be ethical while pursuing profit.Encourage ethical behaviors and gain support from staff.2)Research hints: KFC’s ―Sudan Red‖ crisis; Siemens’ bribery scandal;Coca-Cola’s Poisoning Orange Juice; Toyota’s product recall, etc.II.Blank-fillingplete the following sentences with the words or phrases given in the box.Change the form when necessary.1) levy 2) Peer 3) hires 4) were thrust5) accountability 6) instinct 7) subnormal 8) manuals2.Find the synonyms for the words or phrases in the brackets from the text and fillin the blanks with the proper forms of the words you’ve found.1) remedy 2) aligned 3) anonymous 4) policing5) emulate 6) analogy 7) override 8) ubiquitousIII.Paraphrasing1.Rewrite the following sentences with the words or phrases given in the brackets,keeping the meaning unchanged.1)In fact, it is what the management actually does that decides a company’sculture because staff would imitate and follow their leaders’ behavior.2)Employees need to know that those people who have behaved ethically shouldbe recognized and promoted by the company, though it may mean extra expense in the short run. In contrast, those who have demonstrated unethical behavior will be dismissed or be held responsible for their behavior in certain ways.3)Instead of fixing the current problem, they recalled all products, not just thosein the area where the problem took place, and then they launched the fake product prevention seal which is omnipresent now. Accordingly, they continued to get greater market share and higher customer loyalty.4)Wiles was famous for his effective concentration of the company business onfive key objectives each quarter and for his persistent pursuit of the five goals.He encouraged staff to try every means to accomplish their goals.5)If employees do not trust their leaders, they would prioritize their individualinterest. As a result, there’ll be huge cost in poor operation, company disorder, and in restructuring.2.Rewrite the following sentences in your own words.1)Staff sometimes will protect top managers or even forgive them for theirunethical behavior because it would be destructive if they leave the company.However, the fact is that company leaders should stick to highest standards of ethics.2)If the original company who charges extraordinarily high price had started tooperate more ethically with an average rate of return, then it would not suffer greater cost (losses or even being wiped out of the industry) unless it works efficiently (which is almost impossible).3)At the beginning, Wiles’ strategy helped improve company performance,boost sales and gain market-share. However, as there’s more pressure to achieve the objectives at any expense, staff began to behave carelessly with improper behaviors.4)At first, Intel did not admit the problem, causing both financial losses andreputation losses for the company. Yet Intel finally took the right approach and solved the problem with a relatively mild cost. In fact, very few Pentium processors were returned.5)Due to the omnipresent, prompt and unidentified communication provided bythe Internet, excessive unethical practices can be easily found and spread at low cost or even no cost.IV.Translation1.Sentence Translation1)当然，每个员工要对自己的行为负责。

2020年BEC阅读题目精选及解析俗话说，熟能生巧，多做一些考前练习题可以帮助我们得到一些做题经验，为了方便大家备考，下面小编给大家带来2020年BEC阅读题目精选及解析。

2020年BEC阅读题目精选Look at the statements below and the advice to businesses on the opposite page about using other companies to run their IT services.1、the need to teach skills to employees working on the outsourced process2、remembering the initial reason for setting up the outsourced project3、the need to draw up agreements that set out how integration is to be achieved4、addressing the issue of staff who work on the outsourced process being at a distant site5、the importance of making someone responsible for the integration process6、staff on the outsourced project familiarising themselves with various details of the business7、problems being associated with an alternative to outsourcingWhen a business decides to outsource its IT services, it needs to consider the question of integration. Four experts give their views.A.Gianluca Tramcere, Silica SystemsAn outsourced IT service is never a fully independent entity. It is tied to the home company's previous and continuing systems of working. But despite the added responsibility of managingnew ways of working, many businesses ignore the integration process. They fail to establish contracts that define the ways in which the two companies will work alongside one another, and focus solely on the technological aspects of service delivery.B.Kevin Rayner, DomolaBusinesses need to build integration competency centres dedicated to managing the integration effort. It is critical to have an individual in charge to check that the external and internal business operations work together. Although companies often think of outsourcing as a way of getting rid of people and assets, they need to remember that, at the same time, outsourcing involves gaining people. Because there is a new operation being carried out in a different way outside of the home business, this creates a training element.C.Clayton Locke, Digital SolutionsCommunication is the key to success, and outsourcing to other regions or countries can lead to a range of problems. For any such initiative, it is necessary to create a team where there is good, open communication and a clear understanding of objectives and incentives. Bringing people to the home location from the outsourced centre is necessary, since it can aid understanding of the complexities of the existing system. To integrate efficiently, outsourcing personnel have to talk to the home company's executives and users to understand their experiences.D.Kim Noon, J G TechOne way to avoid the difficulties of integration is to create a joint-venture company with the outsourcer. Thus, a company can swap its assets for a share of the profits. Yet joint ventures bring potential troubles, and companies should be careful not to losesight of the original rationale for outsourcing: to gain cost efficiencies and quality of service in an area that for some reason could not be carried out entirely in-house. The complexities and costs of a joint-venture initiative should not be underestimated.2020年BEC阅读题目精选解析这篇文章讲的是外购(outsourcing),分别有四位专家就这个问题给出了自己的看法。

Minicase: ALLIED products —narrativeWe have made a number of necessary assumptions. The instructor may decide to make different assumptions.1. The average beta of companies in the commercial aircaraft market (Allied Signal, Boeing,etc) is one according to the latest Value Line Investment Survey. Please note that this may changefrom survey to survey. We assume that the average beta is the appropriate beta for AlliedProducts.2. We assume the debt to equity ratio for Allied Products is no different from the industryaverage.3. We assume the debt beta is zero.These are all questionable assumptions. However, they are as good as any others. (I tend toagree with the instructor that the mini case needs to be tightened up. The above assumptionsshould be put in the instructors manual.)Minicase: AlliedProducts Solution (RWJ, 7th Ed., Page 341-343)Assumptions ResultsPP&E Investment 42,000,000Useful life of PP&E Investment (years) 7Salvage Value of PP&E Investment 12,000,000Annual Depreciation Expense (7 year MACRS) Payback3.84Ending Book Discounted Payback 4.6320.81%Year MACRS % Depreciation Value AAR1 14.29% 6,001,800 35,998,200 IRR15.76%2 24.49% 10,285,800 25,712,400 NPV$10,649,0553 17.49% 7,345,800 18,366,600 PI 1.254 12.49% 5,245,800 13,120,800Last year of project 5 8.93% 3,750,600 9,370,2006 8.93% 3,750,600 5,619,6007 8.93% 3,750,600 1,869,0008 4.45% 1,869,000 0NEW GPWS price/unit (Year 1)NEW GPWS variable cost/unit (Year 1) UPGRADE GPWS price/unit (Year 1) 70,00050,00035,000UPGRADE GPWS variable cost/unit (Year 1) Year 1 marketing and admin costsAnnual inflation rate 3.00% Corporate Tax rate 40.00% Debt-to-Equity ratio 50.00% Rd (Cost of debt Capital) 6.20%Beta--Commercial Aircraft Industry AverageRf (5 year U.S. Treasury Bond) 6.20%Rm - Rf (S&P 500 recent year's average premium) Re(from CAPM) 12.40% AlliedProducts' WACC 8.06% New Aircraft Production (i.e. NEW GPWS Market)Probability Year 1 Year 2 Year 3 Y ear 4 Year 5Strong Growth 0.15 350 403 463 532 612Moderate Growth 0.45 250 275 303 333 366Mild Recession 0.30 150 159 169 179 189Severe Recession 0.10 50 52 53 55 56Expected New Airplane Production215 237 261 289319NEW GPWS Market Growth (Strong Growth) 15.00% NEW GPWS Market Growth (Moderate Growth) 10.00% NEW GPWS Market Growth (Mild Recession) 6.00% NEW GPWS Market Growth (Severe Recession state of economy) 3.00%Total Annual Market for UPGRADE GPWS (units) 2,500 AlliedProducts Market Share in each market 45.00% Year 0 12345SalesNEWUnits 97 107 118 130 144Price 70,00072,100 74,263 76,491 78,786Total NEW6,772,500 7,688,654 8,736,3179,935,34511,308,721UPGRADEUnits 1,125 1,125 1,125 1,125 1,125 Price 35,000 36,050 37,132 38,245 39,393Total UPGRADE39,375,000 40,556,250 41,772,938 43,026,126 44,316,909T o t a l S a l e s 46,147,500 48,244,904 50,509,254 52,961,47055,625,630Variable CostsNEW 4,837,500 5,491,896 6,240,226 7,096,675 8,077,658UPGRADE 24,750,000 25,492,500 26,257,275 27,044,993 27,856,343Total Variable Costs 29,587,500 30,984,396 32,497,501 34,141,668 35,934,001 SG&A 3,000,000 3,090,000 3,182,700 3,278,181 3,376,526 Depreciation 6,001,800 10,285,800 7,345,800 5,245,800 3,750,600 EBIT 7,558,200 3,884,708 7,483,253 10,295,821 12,564,503 Interest 0 0 0 0 0Tax 3,023,280 1,553,883 2,993,301 4,118,329 5,025,80122,0003,000,000 1.00 8.30%Net Income 4,534,920 2,330,825 4,489,952 6,177,493 7,538,702OCF = EBIT + Dep - Taxes 10,536,720 12,616,625 11,835,752 11,423,293 11,289,302Less: Change in NWC 2,000,000 307,375 104,870 113,218 122,611 (2,648,074)Less: Captial Spending 42,000,000 (10,948,080) CF from Assets: (44,000,000) 10,229,345 12,511,755 11,722,534 11,300,682 24,885,455 Cumulative CF 10,229,345 22,741,100 34,463,634 45,764,316 70,649,771 (9,536,366) 0.84Discounted OCF 9,466,357 10,714,904 9,290,233 8,287,906 16,889,655Cumulative Discounted CF 9,466,357 20,181,261 29,471,494 37,759,400 54,649,055 10,649,055 0.63 Total Discounted OCF 54,649,055Less: Investment (44,000,000)Net Present Value $ 10,649,055。

Part Two：Passage ReadingTask 11.Because store description is where we introduce the basic information of the storeand show the advantages and strength of it.2.The business store description is richer in content, while the personal storedescription is usually more concise, and pays more attention to visual marketing tools such as store decoration.3.Make full use of store decoration tools, such as shop sign, picture rotation,recommended products, customized contents and so on.Task 21.philosophy2.Patent3.credible4.campaign5.neglects6.rotation7.visual8.proportionTask 31.Our client wants a simple and intuitive interface.2.The store description of a business store usually includes a general introduction tothe company’s business scope.3.We want to create a fashion and dynamic brand image.4.Team members speak alternately in the marketing class.5. A Russian customer is not satisfied with our product and wants to know our returnpolicy.6.Our price must be consistent with the market price.Part Three：Mini-ProjectTask 1Established in 2002, Hangzhou ABC Clothing Co., Ltd. is a clothing enterprise based on the design, development, production and sale of high-end women's clothing brand. The company has been focusing on the European and American markets in France, Spain and Italy for ten years, and officially switched to cross-border e-commerce market in 2012.ABC Clothing Co., Ltd. has more than 200 employees, with a factory area of more than 1500 square meters. It has a professional design team, modern production equipment and a sales team with sharp eyesight.ABC Clothing Co., Ltd. insists on the mission of "supporting the rapid growth of dealers and creating a beautiful life for customers", making efforts to create a competitive clothing production and wholesale enterprise for the European and American market!（答案仅供参考）Task 2Service TermsWe provide perfect after-sales service, promising from the date of delivery (subject to the sign date of customer) for the time within the specified time (30 days for regular price products, 15 days for reduced price products), if there is any dissatisfaction with the goods, we will provide unwarranted return service.1. Return service notice:(1) Please ensure the integrity of returned goods, that is, goods need to maintain their original quality and function, and the products themselves, accessories, trademarks, labels and tag are complete. Please return the whole package for a set of goods.(2) Please return the goods, tag, accessories, physical gifts, and commodity packaging (not including cartons, express bags).2. The following cases are not accepted for return:(1) For safety and hygiene considerations, personal accessories such as underwear, swimsuit, sports bra, socks, panty hose, bottom wear and so on.(2) Products that have been washed, worn, or damaged for personal reasons.(3) Trademarks, logo and so on have been removed.(4) Only the gift with purchase, but not the product itself.(5) Products that exceed the return time limit.3. Return and exchange due to quality issues:(1) We promise that all the goods are sold after the quality inspection. If you find the quality defects, please make sure to contact the customer service within 30 days after signing the goods (within 15 days for reduced price products), and request return or exchange under the guidance of the customer service. We will cover all the fees of return or exchange due to quality issues.(2) Please understand returns and exchanges due to the following reasons can't be processed as quality problem and will be treated as a general return:a)Because of the difference in color between lights, computer monitors, or personalunderstanding of colors, there may be some color differences between photos and actual products. This does not belong to the quality issues.b)The product details page provides a standard size table for your reference only; itmay be slightly different from your measurement results due to manual measurements, different batches, or personal measurement standards.c)Please check the goods in time after receiving them, and try them on, and timelyask for the return request. Requests exceeding the specified time limit (30 days for regular price products, 15 days for reduced price products) will not be able to be processed for return or exchange.Passage Translation店铺描述店铺描述是我们向买家介绍店铺基本情况和展示店铺优势和实力的窗口，因此不容忽视。

Unit 1 ReceptionSection A Warm Up1. rest room2. reception room3. waitress4. registration form5. bellboy6. guest bookSection B Listening and SpeakingWork AloneⅠ. 1. F 2. T 3. TⅡ.1. guide 2. coming to meet 3. AttentionⅢ. reservation, single room, of course, ninth, staySection C ReadingPost-readingⅠ. 1. T 2. F 3. TⅡ.1. basic2. attract3. approached4. respect5. Communication6. repeat Ⅲ.1.first name2. shake hands3. look forward to4. Stand up5. talk to Section D WritingⅠ.Ⅱ.Unit 2 Make an AppointmentSection B Listening and SpeakingWork AloneⅠ. 1. T 2. F 3. TⅡ. 1. be free 2. as soon as 3. messageⅢ. make an appointment, afraid, earlier, shall, a lotSection C ReadingPost-readingⅠ1. People may invite others by telephone or an invitation letter.2. You may say “Thank you for inviting me, but I will not be able to come”.3. Send a thank-you note or give a telephone call to inviter to express the appreciation for the invitation.Ⅱ1. idiom 2. wise 3. refuse 4. appropriate 5. consider 6. appreciationⅢ1.drop in2. in advance3. was unable to4. invitation letter5. a thank-you noteSection D WritingⅠFoundAn MP5 was found at the entrance to the Dahua Cinema on the evening of February 6th. Will the owner please contact the manager of Dahua Cinema?ⅡAn English Editor WantedOur school newspaper is looking for an editor for its English edition. The job mainly includes two parts: One is to choose proper English articles from other newspapers, magazines or Internet for us students. The other is to pick out articles form those written by students in our school and edit them for use.We hope that he/she could meet the following requirements: First, he/she is willing to devote some of his/her spare time to serving the others. Second, it’s necessary for him/her to be good at both English and fine arts. Besides, the ability to use the computer is important.Those who are interested in the job, please get in touch with the Students’ Union this week.Students’ UnionUnit 3 Bank ServiceSection A Warm Up1. passbook2. A TM3. banknote4. debit card5. coin6. queue machine7. currency counter8. check Section B Listening and SpeakingWork AloneⅠ1. F 2. T 3. FⅡ. 1. ordinary 2. overdraw 3. pick it upⅢpersonal check take cable charges instruct return cableSection C ReadingPost-readingⅠ.1. F 2. F 3. TⅡ1. password 2. overdraft 3. issued 4. deposit 5. plastic 6. stolenⅢ1. insteading of 2. Fill in 3. a large amount of 4. waiting for 5. from time to timeSection D WritingⅠ.ⅡUnit 4 Hotel ServiceSection B Listening and SpeakingWork AloneⅠ. 1. T 2. F 3. TⅡ1. hotel services 2. sign 3. luggageⅢcheck out, total, credit card, receipt, pleasureSection C ReadingPost-readingⅠ1. direct-dial telephone, 24-hour room service, color TV, controls for lights and air-conditioning, minibar, tea and coffee-making facilities and a personal safe.2. On the 19th floor.3. It is open from 8 am to 11 pm.Ⅱ1. gym 2. safe 3. lounge 4. control 5. facilities 6. availableⅢ1.less than 2. a range of 3. are equipped with 4. check outSection D WritingⅠ尊敬的张老师，由于我得了重感冒，所以我今天不能来上课，为此我感到非常抱歉。

Mini Case （Topic 2）Donna Jamison, a 2003 graduate of the University of Tennessee with four years of banking experience, was recently brought in as assistant to the chairman of the board of Computron Industries, a manufacturer of electronic calculators.The Company doubled its plant capacity, opened new sales offices outside its home territory, and launched an expensive advertising campaign. Computron’s results were not satisfactory, to put it mildly. Its board of directors, which consisted of its president and vice-president plus its major stockholders(who were all local businesspeople), was most upset when directors learned how the expansion was going. Suppliers were being paid late and were unhappy, and the bank was complaining about the deteriorating situation and threatening to cut off credit. As a result, Al Watkins, Computron’s president, was informed that changes would have to be made, and quickly, or he would be fired. Also, at the board’s insistence Donna Jamison was brought in and given the job of assistant to Fred Campo, a retired banker who was Computron’s Chairman and largest stockholder. Campo agreed to give up a few of his golfing days and to help nurse the company back to health, with Jamison’s help.Jamison began by gathering financial statements and other data.BALANCE SHEET 2008 2007AssetsCash $ 7,282 $ 9,000 Short-term investments 0 48,600 Accounts receivable 632,160 351,200 Inventories 1,287,360 715,200 Total current assets $ 1,926,802 $ 1,124,000 Gross fixed assets 1,202,950 491,000 Less accumulated depreciation 263,160 146,200Net fixed assets $ 939,790 $ 344,800 Total assets $ 2,866,592 $ 1,468,800 Liabilities and Equity 2008 2007 Accounts payable $ 524,160 $ 145,600 Notes payable 720,000 200,000 Accruals 489,600 136,000 Total current liabilities $ 1,733,760 $ 481,600 Long-term debt 1,000,000 323,432 Common stock(100,000 shares) 460,000 460,000 Retained earnings (327,168) 203,768 Total equity $ 132,832 $ 663,768 Total liabilities and equity $ 2,866,592 $ 1,468,800 INCOME STATEMENT 2008 2007Sales $ 5,834,400 $ 3,432,000Cost of goods sold 5,728,000 2,864,000 Other expenses 680,000 340,000 Depreciation 116,960 18,900Total operating costs $ 6,524,960 $ 3,222,900EBIT ($ 690,560) $ 209,100Interest expense 176,000 62,500EBT ($ 866,560) $ 146,600 Taxes(40%) (346,624) 58,640Net income ($ 519,936) $ 87,960EPS ($ 5.199) $ 0.880DPS $ 0.110 $ 0.220Book value per share $ 1.328 $ 6.638Stock price $ 2.25 $ 8.50 Shares outstanding 100,000 100,000Tax rate 40.00% 40.00% Lease payments 40,000 40,000 Sinking fund payments 0 0STA TAMENT OF RETAINED EARNINGS,2008Balance of retained earnings,12/31/07 $ 203,768Add: Net income,2008 (519,936)Less: Dividends paid (11,000)Balance of retained earnings,12/31/08 ($ 327,168)STA TEMENT OF CASH FLOWS, 2008Operating ActivitiesNet Income ($ 519,936) Adjustments:Noncash adjustments:Depreciation 116,960Changes in working capital:Change in accounts receivable (280,960)Change in inventories (572,160)Change in accounts payable 378,560Change in accruals 353,600Net cash provided by operating activities ($ 523,936)Long-Term Investing ActivitiesCash used to acquired fixed assets ($ 711,950) Financing ActivitiesChange in short-term investments $ 48,600Change in notes payable 520,000Change in long-term debt 676,568Payment of cash dividends (11,000)Net cash provided by financing activities $ 1,234,168Sum: Net change in cash (1,718)Plus: Cash at beginning of year $ 9,000Cash at end of year $ 7,282Assume that you are Jamison’s assistant, and you must help her answer the following questions for Campo.a.What effect did the expansion have on sales, net operating profit aftertaxes(NOPAT),net operating working capital, and net income?b.What effect did the expansion have on net cash flow, operating cash flow, and freecash flow?c.Jamison also has asked you to estimate Computron’s EV A. She estimates that theafter-tax cost of capital was 11 percent in 2007 and 13 percent in 2008.d.Looking at Computron’s stock price today, would you conclude that the expansionincreased or decreased MV A?putron purchases materials on 30-day terms, meaning that it is supposed topay for purchases within 30 days of receipt. Judging from its 2008 balance sheet, do you think Comptron pays suppliers on time? Explain. If not, what problems might this lead to?ptron spends money fro labor, materials, and fixed assets(depreciation) tomake products, and still more money to sell those products. Then, it makes sales that result in receivables, which eventually result in cash inflows. Does it appear that Comptron’s sales price exceeds its costs per unit sold? How does this affect the cash balance?g.Suppose Computron’s sales manager told the sales staff to start offering 60-daycredit terms rather than the 30-day terms now being offered. Computron’s competitors react by offering similar terms, so sales remain constant. What effect would this have on the cash account? How would the cash account be affected if sales doubled as a result of the credit policy change?h.Can you imagine a situation in which the sales price exceeds the cost of producingand selling a unit of output, yet a dramatic increase in sales volume causes the cash balance to decline?i.In general, could a company like Computron increase sales without acorresponding increase in inventory and other assets? Would the asset increase occur before the increase in sales, and, if so, how would that affect the cash account and the statement of cash flows?j.Did Computron finance its expansion program with internally generated funds(additions to retained earnings plus depreciation) or with external capital?How does the choice of financing affect the company’s financial strength?k.Refer to the income statements and the statement of cash flows.Suppose Computron broke even in 2008 in the sense that sales revenues equaled total operating costs plus interest charges. Would the asset expansion have caused the company to experience a cash shortage which required it to raise external capital? l.If Computron started depreciating fixed assets over 7 years rather than 10 years, would that affect (1)the physical stock of assets,(2)the balance sheet account for fixed assets,(3)the company’s reported net income, and (4)its cash position?Assume the same depreciation method is used for stockholder reporting and for tax calculations, and the accounting change has no effect on assets’ physical lives. m.Explain how(1)inventory valuation methods, (2)the accounting policy regarding expensing versus capitalizing research and development, and (3) the policy with regard to funding future retirement plan costs(retirement pay and retirees’ health benefits) could affect the financial statements.putron’s stock sells for $2.25 per share even though the company had largelosses. Does the positive stock price indicate that some investors are irrational? putron followed the standard practice of paying dividends on a quarterly basis. It paid a dividend during the first two quarters of 2008, then eliminated the dividend when management realized that a loss would be incurred for the year.The dividend was cut before the losses were announced, and at that point the stock price fell from $8.50 to $ would an $0.11, or even a $0.22, dividend reduction lead to a $5.00 stock price reduction?p.Explain how earnings per share, dividends per share, and book value per share are calculated, and what they mean. Why does the market price per share not equal the book value per share?q.How much new money did Computron borrow from its bank during 2007?How much additional credit did its suppliers extend? Its employees and the taxing authorities?r.If you were Computron’s banker, or the credit manager of one of its suppliers, would you be worried about your job? If you were a current Computron employee,a retiree, or a stockholder, should you be concerned?s.The 2008 income statement shows negative taxes, that is, a tax credit. How much taxes would the company have had to pay in the past to actually get this credit? If taxes paid within the last 2 years had been less than $346,624, what would have happened? Would this have affected the statement of cash flows and the ending cash balance?t.Working with Jamison has required you to put in a lot of overtime, so you have had very little time to spend on your private finances. It’s now April 1, and you have only two weeks left to file your income tax return. You have managed to get all the information together that you will need to complete your return.Computron paid you salary of $45,000, and you received $3,000 in dividend from common stock that you own. You are single, so your per personal exemption is $2,800, and your itemized deduction are $4,550.(1)On the basis of the information above and the individual tax rate scheduleshown in the topic, what is your tax liability?(2)What are your marginal and average tax rates?u.Assume that a corporation has $100,000 of taxable income from operations plus $5,000 of interest income and $10,000 of dividend income. What is the company’s tax liability?v.Assume that after paying your personal income tax as calculated in part t, you have $5,000 to invest. You have narrowed your investment choices down to California bonds with a yield of 7 percent or equally risky Exxon Mobil bonds with a yield of 10 percent. Which one should you choose and why? At what marginal tax rate would you be indifferent to the choice between California and Exxon Mobil bonds?。

CHAPTER 1 GLOBALIZATION AND THE MULTINATIONAL FIRM SUGGESTED ANSWERS TO END-OF-CHAPTER QUESTIONSQUESTIONS1. Why is it important to study international financial managementAnswer: We are now living in a world where all the major economic functions i.e. consumptionproduction and investment are highly globalized. It is thus essential for financial managers to fullyunderstand vital international dimensions of financial management. This global shift is in markedcontrast to a situation that existed when the authors of this book were learning finance some twenty yearsago.At that time most professors customarily and safely to some extent ignored international aspectsof finance. This mode of operation has become untenable since then.2. How is international financial management different from domestic financial managementAnswer: There are three major dimensions that set apart international finance from domestic finance.They are: 1. foreign exchange and political risks 2. market imperfections and 3. expanded opportunity set.3. Discuss the three major trends that have prevailed in international business during the last two decades.Answer: The 1980s brought a rapid integration of international capital and financial markets. Impetus forglobalized financial markets initially came from the governments of major countries that had begun toderegulate their foreign exchange and capital markets. The economic integration and globalization thatbegan in the eighties is picking up speed in the 1990s via privatization. Privatization is the process bywhich a country divests itself of the ownership and operation of a business venture by turning it over tothe free market system. Lastly trade liberalization and economic integration continued to proceed at boththe regional and global levels.4. How is a country‟s economic well-being enhanced through free international trade in goods andservicesAnswer: According to David Ricardo with free international trade it is mutually beneficial for twocountries to each specialize in the production of the goods that it can produce relatively most efficientlyand then trade those goods. By doing so the two countries can increase their combined productionwhich allows both countries to consume more of both goods. This argument remains valid even if acountry can produce both goods more efficiently than the other country. International trade is not a …zero-sum‟ game in which one country benefits at the expense of another country. Rather international tradecould be an …increasing-sum‟ game at which all players become winners.5. What considerations might limit the extent to which the theory of comparative advantage is realisticAnswer: The theory of comparative advantage was originally advanced by the nineteenth centuryeconomist David Ricardo as an explanation for why nations trade with one another. The theory claimsthat economic well-being is enhanced if each country‟s citizens produce what they have a comparativeadvantage in producing relative to the citizens of other countries and then trade products. Underlying thetheory are the assumptions of free trade between nations and that the factors of production landbuildings labor technology and capital are relatively immobile. To the extent that these assumptions donot hold the theory of comparative advantage will not realistically describe international trade.6. What are multinational corporations MNCs and what economic roles do they playAnswer: A multinational corporation MNC can be defined as a business firm incorporated in onecountry that has production and sales operations in several other countries. Indeed some MNCs haveoperations in dozens of different countries. MNCs obtain financing from major money centers around theworld in many different currencies to finance their operations. Global operations force the treasurer‟soffice to establish international banking relationships to place short-term fundsin several currencydenominations and to effectively manage foreign exchange risk.7. Mr. Ross Perot a former Presidential candidate of the Reform Party which is a third political party inthe United States had strongly objected to the creation of the North American Trade AgreementNAFTA which nonetheless was inaugurated in 1994 for the fear of losing American jobs to Mexicowhere it is much cheaper to hire workers. What are the merits and demerits of Mr. Perot‟s position onNAFTA Considering the recent economic developments in North America how would you assess Mr.Perot‟s position on NAFTAAnswer: Since the inception of NAFTA many American companies indeed have invested heavily inMexico sometimes relocating production from the United States to Mexico. Although this might havetemporarily caused unemployment of some American workers they were eventually rehired by otherindustries often for higher wages. Currently the unemployment rate in the U.S. is quite low by historicalstandard. At the same time Mexico has been experiencing a major economic boom. It seems clear thatboth Mexico and the U.S. have benefited from NAFTA. Mr. Perot‟s concern appears to hav e been illfounded.8. In 1995 a working group of French chief executive officers was set up by the Confederation of FrenchIndustry CNPF and the French Association of Private Companies AFEP to study the French corporategovernance structure. The group reported the following among other things “The board of directorsshould not simply aim at maximizing share values as in the U.K. and the U.S. Rather its goal should be toserve the company whose interests should be clearly distinguished from those of its shareholdersemployees creditors suppliers and clients but still equated with their general common interest which isto safeguard the prosperity and continuity of the company”. Evaluate the above recommendation of theworking group.Answer: The recommendations of the French working group clearly show that shareholder wealthmaximization is not a universally accepted goal of corporate management especially outside the UnitedStates and possibly a few other Anglo-Saxon countries including the United Kingdom and Canada. Tosome extent this may reflect the fact that share ownership is not wide spread in most other countries. InFrance about 15 of households own shares.9. Emphasizing the importance of voluntary compliance as opposed to enforcement in the aftermath ofcorporate scandals e.g. Enron and WorldCom U.S. President George W. Bush stated that while tougherlaws might help “ultimately the ethics of American business depends on the conscience of America‟sbusiness leaders.” Describe your view on this statement.Answer: There can be different answers to this question. If business leaders always behave with a highethical standard many of the corporate scandals we have seen lately might not have happened. Since wecannot fully depend on the ethical behavior on the part of business leaders the society should protectitself by adopting therules/regulations and governance structure that would induce business leaders tobehave in the interest of the society at large.10. Suppose you are interested in investing in shares of Nokia Corporation of Finland which is a worldleader in wireless communication. But before you make investment decision you would like to learnabout the company. Visit the website of CNN Financial network and collectinformation about Nokia including the recent stock price history and analysts‟ views of the company.Discuss what you learn about the company. Also discuss how the instantaneous access to information viainternet would affect the nature and workings of financial markets.Answer: As students might have learned from visiting the website information is readily available evenfor foreign companies like Nokia. Ready access to international information helpsintegrate financialmarkets dismantling barriers to international investment and financing. Integration however may help afinancial shock in one market to be transmitted to other markets.MINI CASE: NIKE‟S DECISION Nike a U.S.-based company with a globally recognized brand name manufactures athletic shoes insuch Asian developing countries as China Indonesia and Vietnam using subcontractors and sells theproducts in the U.S. and foreign markets. The company has no production facilities in the United States.In each of those Asian countries where Nike has production facilities the rates of unemployment andunderemployment are quite high. The wage rate is very low in those countries by the U.S. standardhourly wage rate in the manufacturing sector is less than one dollar in each of those countries which iscompared with about 18 in the U.S. In addition workers in those countries often are operating in poorand unhealthy environments and their rights are not well protected. Understandably Asian host countriesare eager to attract foreign investments like Nike‟s to develop their economies and raise the livingstandards of th eir citizens. Recently however Nike came under a world-wide criticism for its practice ofhiring workers for such a low pay “next to nothing” in the words of critics and condoning poor workingconditions in host countries. Evaluate and discuss various …ethical‟ as well as economic ramifications of Nike‟s decision toinvest in those Asian countries.Suggested Solution to Nike‟s Decision Obviously Nike‟s investments in such Asian countries as China Indonesia and Vietnam weremotivated to take advantage of low labor costs in those countries. While Nike was criticized for the poorworking conditions for its workers the company has recognized the problem and has substantiallyimproved the working environments recently. Although Nike‟s workers get paid very low wages by theWestern standard they probably are making substantially more than their local compatriots who are eitherunder- or unemployed. While Nike‟s detractors may have valid points one should not ignore the fact thatthe company is making contributions to the economic welfare of those Asian countries by creating jobopportunities. CHAPTER 1A THEORY OF COMPARATIVE ADVANTAGE SUGGESTED SOLUTIONS TO APPENDIX PROBLEMSPROBLEMS1. Country C can produce seven pounds of food or four yards of textiles per unit of input. Compute theopportunity cost of producing food instead of textiles. Similarly compute the opportunity cost ofproducing textiles instead of food.Solution: The opportunity cost of producing food instead of textiles is one yard of textiles per 7/4 1.75pounds of food. A pound of food has an opportunity cost of4/7 .57 yards of textiles.2. Consider the no-trade input/output situation presented in the following table for Countries X and Y.Assuming that free trade is allowed develop a scenario that will benefit the citizens of both countries.INPUT/OUTPUT WITHOUT TRADE_________________________________________________________________ ______ Country X YTotal___________________________________________________________________ _____I. Units of Input000000_____________________________________________________Food 70 60Textiles 4030______________________________________________________________________ __II. Output per Unit of Inputlbs or yards____________________________________________________Food 17 5Textiles 52_______________________________________________________________________ _III. Total Outputlbs or yards000000____________________________________________________Food 1190 300 1490Textiles 200 60260_____________________________________________________________________ ___IV. Consumptionlbs or yards000000___________________________________________________Food 1190 300 1490Textiles 200 60260_____________________________________________________________________ ___Solution: Examination of the no-trade input/output table indicates that Country X has an absoluteadvantage in the production of food and textiles. Country X can “trade off” one unit of productionneeded to produce 17 pounds of food for five yards of textiles. Thus a yard of textiles has an opportunitycost of 17/5 3.40 pounds of food or a pound of food has an opportunity cost of 5/17 .29 yards oftextiles. Analogously Country Y has an opportunity cost of 5/2 2.50 pounds of food per yard oftextiles or 2/5 .40 yards of textiles per pound of food. In terms of opportunity cost it is clear thatCountry X is relatively more efficient in producing food and Country Y is relatively more efficient inproducing textiles. Thus Country X Y has a comparative advantage in producing food textile iscomparison to Country Y X. When there are no restrictions or impediments to free trade the economic-well being of thecitizens of both countries is enhanced through trade. Suppose that Country X shifts 20000000 unitsfrom the production of textiles to the production of food where it has a comparative advantage and thatCountry Y shifts 60000000 units from the production of food to the production of textiles where it has acomparative advantage. Total output will now be 90000000 x 17 1530000000 pounds of food and20000000 x 5 100000000 90000000 x 2 180000000 280000000 yards of textiles.Further suppose that Country X and Country Y agree on a price of 3.00 pounds of food for one yard oftextiles and that Country X sells Country Y 330000000 pounds of food for 110000000 yards of textiles.Under free trade the following table shows that the citizens of Country X Y have increased theirconsumption of food by 10000000 30000000 pounds and textiles by 10000000 10000000 yards.INPUT/OUTPUT WITH FREE TRADE_________________________________________________________________ _________ Country X YTotal___________________________________________________________________ _______I. Units of Input 000000_______________________________________________________Food 90 0Textiles 2090______________________________________________________________________ ____II. Output per Unit of Input lbs or yards______________________________________________________Food 17 5Textiles 52_______________________________________________________________________ ___III. Total Output lbs or yards 000000_____________________________________________________Food 1530 0 1530Textiles 100 180280_____________________________________________________________________ _____IV. Consumption lbs or yards 000000_____________________________________________________Food 1200 330 1530Textiles 210 70280_____________________________________________________________________ _____ CHAPTER 3 BALANCE OF PAYMENTS SUGGESTED ANSWERS AND SOLUTIONS TO END-OF-CHAPTER QUESTIONS AND PROBLEMSQUESTIONS1. Define the balance of payments.Answer: The balance of payments BOP can be defined as the statistical record of a country‟sinternational transactions over a certain period of time presented in the form of double-entry bookkeeping.2. Why would it be useful.。