An Argument for an MNC to Have a Debt-Intensive Capital

question 45

Multiple Choice

An argument for an MNC to have a debt-intensive capital structure is that:

• A) it can reduce the MNC's exposure to exchange rate risk on earnings remitted by subsidiaries to the parent.
• B) it can reduce the chance of bankruptcy.
• C) it spreads the shareholder base.
• D) it forces subsidiaries to pay dividends to shareholders.

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