Arbitrage opportunities in global financial markets are more attractive to global companies than local corporations, because they enable them to buy in huge volume and therefore increase their bargaining power with suppliers.

Question

Quizplus · Accepted Answer

In the current integrated global financial markets, a firm can borrow anywhere in the world where capital is cheap and use it to fund a project in a country where capital is expensive. Such arbitrage opportunities are even more attractive to global corporations because their larger size enables them to buy in huge volume, thus increasing their bargaining power with suppliers.

Arbitrage Opportunities in Global Financial Markets Are More Attractive to Global