Which of the Following Will Most Likely Harm a Multinational

question 45

Multiple Choice

Which of the following will most likely harm a multinational enterprise's (MNE's) reputation?

• A) Principal-agent problems cause an MNE to merge with another MNE.
• B) Increased competition causes an MNE to close a factory in a developing country.
• C) Wages for workers in a factory owned by an MNE increase, causing profits to decline.
• D) A sweatshop owned by an MNE has an explosion that kills hundreds of workers.

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Definitions:

Chapter 7

A bankruptcy process outlined in the United States Bankruptcy Code whereby a debtor's assets are liquidated to pay off creditors.

Bankruptcy

A judicial procedure allowing individuals or companies that cannot pay off their debts to obtain relief from part or all of their financial obligations.

$200 Payment

A financial transaction involving the transfer of two hundred dollars from one party to another.

Priority Claims

In bankruptcy proceedings, debts that are entitled to be paid before other debts due to their importance as defined by law, such as taxes and employee wages.