1. In class we reviewed three firms in three different countries. The M/S Milad Nor Company in Afghanistan, Caritex in Bulgaria, and Obod in Montenegro. Each company was faced with different problems and issues. Please briefly summarize the similarities between the firms and their individual issues. How do the problems faced by these firms compare to problems faced by similar firms in more developed countries? a. Building a business is never an easy task add the uncertainty inherent in an emerging market, an undeveloped regulatory environment, and lack of access to reasonably-priced capital and the challenges become almost insurmountable. In spite of the odds emerging markets are full of examples of entrepreneurs that faced these
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2. Your stock market simulation calls for you to invest in securities with a significant presence outside the US – debt, equity, commodities, currencies, derivatives… In researching equities trading on exchanges outside of the US what similarities/differences have you found compared to firms trading on exchanges in the US? b. This one you can talk about how the stock market in china when a securities is trade in the market falling badly, the exchange normally ban the securities from trading for the rest of day, also the operating hour for exchange are typically shorter in China。Also in china government steps in whenever the market is on trouble. 3. 4. What are the key differences in the goals and motivations of family ownership of the business as opposed to the widely held publicly traded business? A privately held firm has a much simpler shareholder return objective function: maximize current and sustainable income. The privately held firm does not have a share price (it does have a value, but this is not a definitive market-determined value in the way in which we believe markets work).
It therefore simply focuses on generating current income, dividend income, to generate the returns to its ownership. If the privately held ownership is a family, the family may also place a great emphasis on the ability to sustain those earnings over time while maintaining a slower rate of growth which can be managed