MULTINATIONAL CAPITAL BUDGETING DECISIONS
Difficulties and Importance
capital budgeting decisions are beset with a variety of problems that are rarely ounce domestic! local firms. The reason is Hat international firms have to deal with issues related g others, exchange rate risks, expropriation risk, blocked funds: foreign tax regulations, risk and differences between basic business risks of foreign and domestic projects er in spite of the complex problems of investing abroad, there is an increasing trend.
to proprietaries by Mn Cs and to have direct foreign investment by international firms in other The major motivating factors for undertaking these investments are as follows Comcast advantage s a major factor din favor of foreign investments Taxation is another mic financial incentive to make such investments, financial diversification, in terms ting the firm's risk over a wider range than just one nation. constitutes yet another economic motivation for multinational firms.' Foreign capital budgeting projects decisions are more difficult to evaluate than domestic capital budgeting projects. For operational purposes; there is a need to develop a conceptual framework that enables the set of actors mentioned above to he measured/reduced to a common denominatorS 0S0 that t