Risks Inherent in Making Investments in Foreign Countries Include

question 124

Multiple Choice

Risks inherent in making investments in foreign countries include:

• A) the value of their investment changes as the exchange rates change.
• B) cash flows to be received in the future may be worth less when actually received if the foreign exchange rate fluctuates dramatically.
• C) political risks due to an unstable government.
• D) All of the options are risks inherent in making investments in foreign countries.

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Definitions:

Benefits

Advantages or favorable outcomes derived from actions, policies, or circumstances.

Assumption

A basic condition or premise believed to be true without proof for the purpose of reasoning and decision-making.

Hypothesis

A suggested theory formulated from minimal evidence intended as an initial step for more in-depth inquiry.

Behavior

The actions or reactions of an individual or system in response to external or internal stimuli.