A US-Based MNC Has a Subsidiary in Barbados That Generates Substantial

question 1

Multiple Choice

A U.S.-based MNC has a subsidiary in Barbados that generates substantial net cash inflows denominated in Barbados dollars. Given this information, the MNC would ____ from a(n) ____ of the Barbados dollar.

• A) benefit; appreciation
• B) benefit; depreciation
• C) not benefit; appreciation
• D) None of these are correct.

---

Definitions:

Operating Cycle

An operating cycle is the average period of time it takes for a business to convert its inventory into cash proceeds from sales.

Receivables

Amounts owed to a company by customers for goods or services that have been delivered or used but not yet paid for.

Raw Materials

Basic materials and substances used in the initial production or manufacturing of goods.

Balance Sheet

A financial statement that reports a company's assets, liabilities, and shareholders' equity at a specific point in time.