3 questions on international finance
The WACC takes into account both equity and debt financing by weighing each component according to its respective market value. This gives investors an overall picture of expected returns before committing their funds to proposed projects or investments.
In addition to these basic components, allowances must also be made for various risks factors such as currency exchange rates, political instability in foreign countries, regulations regarding repatriation of profits etc. All these factors should be taken into consideration when making decisions about international investments – since they can significantly affect expected returns over time. Ultimately, having accurate information about these variables helps investors make informed decisions which balance potential rewards against possible pitfalls – allowing them to maximize their returns while minimizing exposure to unnecessary risk.