International financial crises can have farreaching consequences from "summary" of International Financial Management, Abridged Edition by Jeff Madura
International financial crises can have far-reaching consequences that extend beyond borders and impact economies worldwide. These crises can disrupt financial markets, leading to increased volatility in exchange rates, interest rates, and stock prices. As a result, businesses may face challenges in managing their cash flows, accessing financing, and hedging against risks. One of the key consequences of international financial crises is the decline in investor confidence, which can have a negative impact on economic growth and financial stability. Investors may become more risk-averse, leading to capital flight from emerging markets to safer assets. This can exacerbate the crisis and put further pressure on exchange rates and...
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