International Business Finance: Modern Market

International Business Finance Student’s Name Institutional Affiliation International Business Finance Introduction Every successful business in the modern market have had its ups and down to get there. These challenges continue to pile up on the road to success of a business. Some of the issues that curb influence the success rate of a business originates either from within the business itself or from external factors. Internal factors include the morale of the workers and the short-term decisions that the management makes every day. These small decisions when incorporated together makes the distinction between success and failure (Connolly, 2006). The internal factors are very much within reach of the business managers and can be easily sorted out. External factors, on the other hand, are the ones that are beyond the control of the business but which affects them directly in the everyday activities. They include inflation, government policies and regulations, exchange rates, and competition from other similar businesses in the market. The only option there is past the external factors is to incorporate them into the business system and considering them when making decisions concerning the business (Connolly, 2006). These external factors have a severe damage on a business if not solved as soon as possible in the approved standard way of solving it. Any business that has used unethical means to solve or to be at an advantage point finds itself entangled in legal battles with the business regulatory agencies which have been established by the government to cater for such situations (Connolly, 2006). When a business is operating internationally the challenges increases to another level due to the increased risks that international business poses due to the uncertainties that exist. Business can have any of the crucial forms of its operation being in another country. For instance, a business can have the production in one country and the other operation of administration and marketing are in another country or economic block. If the economic block or the country does not have trade liberalization agreement, the business will be greatly affected due to the influence that the business will experience which to extreme cases causes business closure and complete annihilation. This is because different countries have different laws and regulations that govern and protect their business and which are completely different to another country. This is caused by the difference in the economy that the two countries have. One might be high and the other one low and hence rendering business the art of doing business almost impossible. Tax policies between two countries are one of the hindrances that affect the business between two countries. The issue of double taxation becomes very restricting to the business community. The exchange rate of the currencies greatly influences international business due to the imbalance of the currency. The economic performance in a given country determines the exchange rate that the currencies are going to trade every single day. If there are inequalities in the exchange rates the business sector is affected a lot making hard to conduct business across the international borders (Dunning, 2013). A well established...