REVIEW ESSAY

Review Essay



Review Essay

Introduction

International finance is a unique branch of economics that includes the study of foreign direct investment, foreign exchange and how these influence the international trade. It also emphasizes on the study of international investment, international capital flow and international projects. It could said that this field of finance deals with the financial decisions that are taken by a multinational or any other corporation in the department of internal business for example global corporate finance. Main basis of international finance comes from the preliminary studies that were done in the field of corporate finance for example portfolio theory, cost of capital and capital budgeting etc, however now viewed in an international dimension.

It is quite certain to say that it covers all the techniques, tools and procedures that are offered by financial institutions for example insurance companies and banks, provides to clients. These tools and procedures may include transaction strategies and financing agreements on securities exchanges for example Tokyo Stock Exchange. This field of finance plays an integral role in the development of modern economies. It enables business transactions to be interconnected and also enable multinational corporations to engage in import and export activities.

Discussion

Summary

The main focus of the study “The Mining Industry: From Bust To Boom” is on the Australian mining industry that experienced a remarkable and prominent turnaround and increase in demand during the 2000s. The reason behind the massive growth of the mining industry was due to the drastic growth and development of the economies in Asia, which led to an increase in the demand for commodities used in energy and steel generation. The shortage of supply and increase in demand led to an increase in the prices of the commodities.

This was the main reason leading to an increase in the investment in the mining sector, as many investors perceived it as a potential market. This rise in price also resulted in increased income due to which many investors were force to shift their factors of production towards the mining sector. It has also been suggested that large increase in the exchange rate also contributed to the growth. Comparatively, it could be said that Australia experienced more stable growth during this time in comparison with the earlier booms in mining industry experienced.

It is quite evident that the mining industry experienced an improvement over the 2000s. It could be said that earlier the mining sector was not considered to be a potential sector, as it did not generate much revenue and exports were comparatively very low (Curtin University of Technology, 1999, pp. n.d). This also reflected a continuous decrease in the prices of commodities in relation to other goods and services. On the contrary, rapid development and urbanization of emerging and developing economies in Asia led to a drastic change on the commodity markets. It could be said that the environment is a bit challenging in reference to policies and structures, as it aims to ensure continued check and containment of overall inflation pressures ...