In Theory, the MNE Should Support ________ Debt Ratios Than

question 45

Multiple Choice

In theory, the MNE should support ________ debt ratios than a purely domestic firm because their cash flows are ________.

• A) lower; more stable due to international diversification
• B) lower; less stable due to international diversification
• C) higher; more stable due to international diversification
• D) higher; less stable due to international diversification

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Definitions:

Regression Equation

An equation that describes the relationship between a dependent variable and one or more independent variables.

Calculate

To ascertain a value through mathematical processes.

F

A statistical test used to determine the significance of multiple group comparisons simultaneously, often used in analysis of variance (ANOVA).

Slope

In the context of mathematics and statistics, it refers to the steepness or angle of a line on a graph.