FIN 505 (Multinational Managerial Finance)
Multinational Managerial Finance (3) Analysis of the international aspects of managerial finance. Emphasis on the environmental and institutional factors influencing capital acquisition and allocation.
Overview | Objectives | Materials | Library Resources | Technical Requirements | Assignments | Grading | Course Schedule | Course Policies | Academic Integrity | Accommodating Disabilities | Additional Policies
Overview
The course integrates macro (global financial markets) and micro (multinational enterprise-centric) dimensions within a practitioner perspectives. Students are introduced to some of the unique global business risks and opportunities facing multinationals and how these two dimensions impact corporate financial strategies. The course pedagogy combines an applied theoretical approach with the case study method through detailed analysis of investing, financing, and risk management strategies of multinational corporations. The focus will be on applying fundamental finance concepts and analytical tools for value creation and risk management applicable as they are to multinational financial management.
This course aims to prepare students for a career in multinational corporate financial management in a global setting. It helps students appreciate the strategic motivations, decision processes, and valuation consequences of global financial strategies of multinational corporations. The course facilitates developing the ability among students to plan, implement, and evaluate value adding investing, financing, and risk management strategies in the context of unique opportunities and risks in the global business and financial markets.
Course Objectives
At the completion of the course students should be able to accomplish the following:
- Develop an analytical framework (integrating international market structures, government exchange rate policy regimes, corporate stakeholder preferences, and value maximization goal) for planning, implementing, and evaluating multinational financial strategies.
- Understand the functioning and structures of global financial markets and assess their role in shaping corporate investing, financing, and risk management strategies among multinational corporations.
- Estimate various measures of foreign exchange risks and design and implement hedging strategies.
- Utilize the risk-return tradeoff framework, arrive at investing and financing decisions in multinational firms incorporating unique dimensions attributable to the fact of these firms being active in global markets.
- Estimate cost of capital for multinational firms and apply this concept in financial decision-making including project selection, and capital budgeting.
- Conceptualize, design, implement, and evaluate various methods of raising financial capital in global markets.
- Assess political risks in international markets and plan strategies to minimize their adverse impact on corporate performance.
Required Course Materials
Most World Campus courses require that students purchase materials (e.g., textbooks, specific software, etc.). To learn about how to order materials, please see the Course Materials page. You should check LionPATH approximately 3–4 weeks before the course begins for a list of required materials.
Required Additional Readings and Case Package
The following materials can be purchased from the Harvard Business Review (HBR) website:
- Desai, M. A. (2008). The finance function in a global corporation.
- Desai, M. A., Dessain, V., & Sjoman, A. (2006). Nestle and Alcon: Value of a listing.
- Desai, M.A., Luchs, K., Veblen, M. F., Dave, A., & Raga-Frances, M . (2004). Cross-border listing and depository receipts.
- Desai, M. A. & Schillinger, D. (2006). Globalizing the cost of capital and capital budgeting at AES.
- Desai, M. A. & Veblen, M. F. (2006). Foreign exchange hedging strategies at General Motors: Transactional and translational.
- Desai, M. A. & Veblen, M. F. (2003). Refinancing of Shanghai General Motors.
- Desai, M. A, Wang, Y., Pham, C. B., & Luchs, K. (2007). Foreign exchange markets and transactions.
- Mihir, D. A., Sjoman, A., & Dessain, V. (2007). Hedging currency risks at AIFS.
To access Harvard Business Review articles: Go to the Harvard Business Revies (HBR) website and make sure you register so you can access your course readings. (You will need to register, but you do NOT need to subscribe.) You will need to purchase your HBR readings using your credit card. To read PDF articles, make sure you have the Adobe Reader, which can be downloaded for free from Adobe's website. For technical assistance, contact Harvard Business School Publishing at 1-800-810-8858.
Your custom course materials published by Harvard Business Review contain required readings that have been carefully selected for this course. If you hope to do well in this course, it is important that you purchase them and always stay on top of your readings.
Additional Recommended Material:
The Wall Street Journal, Financial Times, and Business Week publications
The following link will be beneficial in assisting you with gathering data and completing research: NewsBank Access World News .
Library Resources
Many of the University Libraries resources can be utilized from a distance. Through the Libraries website, you can
- access magazine, journal, and newspaper articles online using library databases;
- borrow materials and have them delivered to your doorstep—or even your desktop;
- get research help via email, chat, or phone using the Ask a Librarian service; and
- much more.
You must have an active Penn State Access Account to take full advantage of the Libraries' resources and service. The Off-Campus Users page has additional information about these free services.
The following links from the library will be beneficial in assisting you with gathering data and completing research.
NewsBank Access World News – Financial Times
ProQuest Publications – Wall Street Journal
Technical Specifications
Note: Courses that are designated as running in Canvas have different technical requirements. For those courses, please review the Canvas Technical Requirements for MFIN courses.
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| Operating System | Windows Vista, Windows 7, Windows 8* Macintosh users may have problems using the specialized software required in some courses. *Windows 8 support excludes the tablet only RT version |
| Processor | 1 GHz or higher |
| Memory | 2 GB of RAM |
| Hard Drive Space | 500 MB free disk space |
| Browser | We recommend the latest Angel-supported version of Firefox or
Internet Explorer. To determine if your browser fits this criteria and
for advice on downloading a supported version, please refer to the
following ITS knowledgebase article:http://kb.its.psu.edu/cms/article/6
Note: Cookies, Java, and JavaScript must be enabled. Pop-up blockers should be configured to permit new windows from Penn State web sites. Due to nonstandard handling of CSS, JavaScript, and caching, older versions of Internet Explorer (such as IE 6 or earlier) do not work with our courses. |
| Plug-ins | Adobe Reader [Download from Adobe]
Flash Player [Download from Adobe] |
| Additional Software | Microsoft Office 2007 or higher |
| Internet Connection | Broadband (cable or DSL) connection required |
| Printer | Access to graphics-capable printer |
| DVD-ROM | Required |
| Sound Card, Microphone, and Speakers | Required |
| Monitor | Monitor (Capable of at least 1024 x 768 resolution) |
To ensure instructional videos play correctly on your computer:
- Ensure that your javascript is enabled in your browser. Visit the Enable JavaScript in my browser webpage which will help you through the process of enabling your javascript - https://www.google.com/adsense/support/bin/answer.py?answer=12654.
- Ensure that you have at least Flash Player 11.0 installed. Visit the Install Adobe Flash Player webpage which will help you through the process of installing the flash player - http://get.adobe.com/flashplayer/.
If you need technical assistance at any point during the course, please contact the Service Desk.
For registration, advising, disability services, help with materials, exams, general problem solving, visit World Campus Student Services!
Course Assignments
Group-Based Homework Problem Sets
You will be required to complete three group-based homework problem sets. The homework problems sets will consist of end-of-chapter problems from the course text. Please refer to the course schedule to view the assigned problems and due dates. To assist you with team discussions, there will be a team discussion forum set up in each of the modules so only the members of each team can access their forum as a means to communicate. Feel free to use these team forums as often as you need to when completing each of the assignments. You can also use other means of communication with your team, such as Collaborate, Skype, e-mail, phone, etc.; whichever communication tool works best for your group. Use Excel and incorporate spreadsheet output (show your work) in your submissions. Please put the module number and team name in the subject of the message (e.g. FIN505_HW1_Team1). The team response to these problems will be submitted to a peer-review drop box so that responses to the problems can be viewed by all students. If you find errors in any problems posted by another team, feel free to post a correction and explanation. The purpose of the submissions is to build resources to refer to when in subsequent MFIN courses.
Note: The group-based homework problem sets will not be graded. However, it is mandatory for teams to submit the assignments for final grade release.
Class Participation Through Case Discussions
There will also be four discussion forums where the instructor will initiate discussion related to the cases (these discussions will take place in Modules 3–6). All students are expected to actively participate (on an individual basis) in each of the online discussion forums and answer all assignment questions. Students should also be conversant with current finance news from The Wall Street Journal and Financial Times as they relate to course topics; be prepared to discuss them. Students will be required to use the Internet to access financial data for class discussions as well.
The case discussions will account for 10% of the final grade (2.5% for each case discussion). Please refer to the Class Participation Grading Rubric to view grading components and values for this part of the assignment. You can also access this file by clicking on the Activities link in the left-hand menu and selecting the folder Course Grading Rubrics.
Finally, check the due dates listed in the course schedule section of the syllabus for each case discussion.
Quizzes
There will be two graded quizzes (worth 15% each) for you to complete during the semester, which will cover the content of modules, assigned textbook readings, and associated problem assignments. Please refer to the course schedule for due dates.
Midterm Exam
There will be a midterm exam, which will consist of short-answer questions and numerical problems. The midterm exam will cover Modules 1–4. The exam will be available for students to complete starting Monday at 8 a.m. (ET) of the exam week and will need to be submitted by the following Monday at 3 a.m. (ET). Additionally, your work will be graded based on the criteria listed in the Exam Grading Rubric. You can also access this rubric by clicking on the Activities link in the left-hand menu and selecting the folder, Course Grading Rubrics. The midterm exam will account for 30% of the final course grade.
Note: During the examination period, communication with other people concerning the subject matter of the exam is prohibited. No makeup examinations will be given for any reason except for medical emergency. Vacation plans, nonrefundable airline tickets, etc. are not acceptable excuses.
Solutions for the numerical problems will be provided for students to calibrate their solutions to the instructor's solutions after the due date. No solutions for the theoretical problems will be provided as these can be found in the notes, slides, and relevant text readings.
Final Exam
There will be a final exam which will consist of multiple-choice questions. The final exam will cover Modules 5–7. The exam will be available for students to complete during the last week of the course. The exam will be available for students to complete starting Monday at 8 a.m. (ET) of the last week of class and will need to be submitted by the following Monday at 3 a.m. (ET).
Note: If needed, you will also be able to provide a rationale (a one sentence explanation as to why you chose the answer as the correct one in a separate document) for any of the multiple-choice questions in the exam for the instructor to review for partial credit. Make sure you identify the question(s) for which you are providing rationale. The final exam will account for 30% of the final course grade.
Note: During the examination period, communication with other people concerning the subject matter of the exam is prohibited. No makeup examinations will be given for any reason except for medical emergency. Vacation plans, nonrefundable airline tickets, etc. are not acceptable excuses.
Spreadsheet Model Building Exercises
There will be a number of financial model building exercises covered in the class using Excel. These exercises will be included within the homework assignments, case assignments, and final exam so you have sufficient practice in strengthening your model-building skills. We will complete several exercises to gain sufficient practice applying the tools and concepts to actual managerial decision scenarios. Please sharpen your Excel skills quickly to ensure that you do not hinder your ability to learn finance and economics.
Please carefully read the summary of deliverables, grading weight, grading rubric, and the due dates for each deliverable to plan ahead and efficiently allocate your time throughout the semester. Academic dishonesty will be dealt with in accordance with the Penn State University provisions.
Grading
| Grading Component | Type | Weight |
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| Group-Based Homework Assignments (3 sets) | Team | (Ungraded; Although, submission is mandatory for final grade release) |
| Class Participation Through Case Discussions (4) | Individual | 10% (2.5% each) |
| Quizzes (2) | Individual | 30% (15% each) |
| Midterm Exam | Individual | 30% |
| Final Exam | Individual | 30% |
| Letter Grade | Percentage |
|---|---|
| A | 95 and above |
| A- | 90-94 |
| B+ | 85-89 |
| B | 80-84 |
| B- | 75-79 |
| C | 65-74 |
Please refer to the University Grading Policy for Graduate Courses for additional information about University grading policies.
FIN 505 Course Schedule
The schedule below outlines the associated timeframes and assignments that we will be covering in this course.
Note: All due dates reflect North American eastern time (ET).
This ensures that all students have the same deadlines regardless of where they live.- Course length: 7 weeks
Each assignment is identified as individual (I) , team (T) , graded (G) , or ungraded (U) .
| Module 1: |
Globalization and the Multinational Enterprise
Objectives and Modes of Globalization |
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| Timeframe: |
Week 1 |
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Readings:
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| Resources: |
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| Videos: |
Total video time for this module is 1:48:21.
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| Assignments: |
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| Module 2: |
Multinational Firm’s Financial Environment: Foreign Exchange Markets
Determinants of Foreign Exchange Rates: Parity Conditions |
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| Timeframe: |
Week 2 |
| Readings: |
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| Resources: |
*Note: Reproduced with permission from Pearson Education, Inc. for electronic usage. |
| Videos: |
Total video time for this module is 5:13:09.
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| Assignments: |
All assignments due by 3:00 AM Eastern Time (ET) on Monday, unless noted otherwise. |
| Module 3: | Hedging Currency Risk: Currency Derivatives |
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| Timeframe: |
Week 3 |
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Readings:
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*Note: Please see the course syllabus for instructions on how to access and view Harvard Business Review articles and cases. |
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Resources:
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*Note: Reproduced with permission from Pearson Education, Inc. for electronic usage. |
| Videos: |
Total video time for this module is 3:28:33.
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| Assignments: |
*Note: Please see the course syllabus for instructions on how to access and view Harvard Business Review articles and cases. All assignments due by 3:00 AM Eastern Time (ET) on Monday, unless noted otherwise. |
| Module 4: | Foreign Exchange Risk: Transaction, Operating, and Translation Exposure |
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| Timeframe: |
Week 4 |
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Readings:
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| Resources: |
*Note: Reproduced with permission from Pearson Education, Inc. for electronic usage. |
| Videos: |
Total video time for this module is 3:31:30.
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| Assignments: |
*Note: Please see the course syllabus for instructions on how to access and view Harvard Business Review articles and cases. All assignments due by 3:00 AM Eastern Time (ET) on Monday, unless noted otherwise. |
| Module 5: | Cross-Border Investing |
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| Timeframe: |
Week 5 |
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Readings:
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*Note: Please see the course syllabus for instructions on how to access and view Harvard Business Review articles and cases. |
| Resources: |
*Note: Reproduced with permission from Pearson Education, Inc. for electronic usage. |
| Videos: |
Total video time for this module is 3:35:41.
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| Assignments: |
*Note: Please see the course syllabus for instructions on how to access and view Harvard Business Review articles and cases. All assignments due by 3:00 AM Eastern Time (ET) on Monday, unless noted otherwise. |
| Module 6: | Financing in International Markets |
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| Timeframe: |
Week 6 |
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Readings:
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*Note: Please see the course syllabus for instructions on how to access and view Harvard Business Review articles and cases. |
| Resources: |
*Note: Reproduced with permission from Pearson Education, Inc. for electronic usage. |
| Videos: |
Total video time for this module is 57:34.
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| Assignments: |
*Note: Please see the course syllabus for instructions on how to access and view Harvard Business Review articles and cases. All assignments due by 3:00 AM Eastern Time (ET) on Monday, unless noted otherwise. |
Course Policies
Late Policy
The course schedule is strictly adhered to. Late assignments/discussion participation, and the exam will be accepted ONLY if the instructor is notified prior to the due date of a special circumstance that cannot be avoided. Students will receive a zero for late work without an acceptable reason.
Academic Integrity
According to Penn State policy G-9: Academic Integrity , an academic integrity violation is “an intentional, unintentional, or attempted violation of course or assessment policies to gain an academic advantage or to advantage or disadvantage another student academically.” Unless your instructor tells you otherwise, you must complete all course work entirely on your own, using only sources that have been permitted by your instructor, and you may not assist other students with papers, quizzes, exams, or other assessments. If your instructor allows you to use ideas, images, or word phrases created by another person (e.g., from Course Hero or Chegg) or by generative technology, such as ChatGPT, you must identify their source. You may not submit false or fabricated information, use the same academic work for credit in multiple courses, or share instructional content. Students with questions about academic integrity should ask their instructor before submitting work.
Students facing allegations of academic misconduct may not drop/withdraw from the affected course unless they are cleared of wrongdoing (see G-9: Academic Integrity ). Attempted drops will be prevented or reversed, and students will be expected to complete course work and meet course deadlines. Students who are found responsible for academic integrity violations face academic outcomes, which can be severe, and put themselves at jeopardy for other outcomes which may include ineligibility for Dean’s List, pass/fail elections, and grade forgiveness. Students may also face consequences from their home/major program and/or The Schreyer Honors College.
How Academic Integrity Violations Are Handled
World Campus students are expected to act with civility and
personal integrity; respect other students' dignity, rights, and
property; and help create and maintain an environment in which all
can succeed through the fruits of their own efforts. An environment
of academic integrity is requisite to respect for oneself and
others, as well as a civil community.
In cases where academic integrity is questioned, the Policy on Academic Integrity indicates that procedure requires an instructor to inform the student of the allegation. Procedures allow a student to accept or contest a charge. If a student chooses to contest a charge, the case will then be managed by the respective college or campus Academic Integrity Committee. If that committee recommends an administrative sanction (Formal Warning, Conduct Probation, Suspension, Expulsion), the claim will be referred to the Office of Student Accountability and Conflict Response.
All Penn State colleges abide by this Penn State policy, but review procedures may vary by college when academic dishonesty is suspected. Information about Penn State's academic integrity policy and college review procedures is included in the information that students receive upon enrolling in a course. To obtain that information in advance of enrolling in a course, please contact us by going to the Contacts & Help page .
Accommodating Disabilities
Additional Policies
For information about additional policies regarding Penn State Access Accounts; credit by examination; course tuition, fees, and refund schedules; and drops and withdrawals, please see the World Campus Student Center website.
Veterans and currently serving military personnel and/or dependents with unique circumstances (e.g., upcoming deployments, drill/duty requirements, VA appointments, etc.) are welcome and encouraged to communicate these, in advance if possible, to the instructor in the case that special arrangements need to be made.
Disclaimer: Please note that the specifics of this Course Syllabus are subject to change, and you will be responsible for abiding by any such changes. Your instructor will notify you of any changes.