Market segmentation and exchange risk are two main factors that distinguish international financing and investment decisions from domestic ones. Existing studies of market segmentation have been conducted within a framework in which exchange risk is not explicitly recognized. This paper performs...

This paper examines how the firm's exposure to exchange rate uncertainty influences its valuation. It identifies the variables affecting the firm's economic and accounting exchange exposure as well as the cost of capital in a formal unified model.© 1986 JIBS. Journal of International Business...