The MNE in an Effort to Minimize the Cost of External

question 27

Multiple Choice

The MNE in an effort to minimize the cost of external funds should choose ________ funds to minimize ________.

• A)internal; debt financing.
• B)internal; taxes and political risk.
• C)external; debt financing.
• D)external; taxes and political risk.

---

Definitions:

Obligation

A legal or moral duty to do or not do something, often with legal implications if not fulfilled.

Indorses

Refers to the act of signing the back of a financial document, thus transferring rights or ownership.

Security Funds

Financial reserves set aside to cover potential losses or liabilities, often used in contexts such as investments, insurance, and real estate.

Stop-Payment Order

An order by a bank customer to his or her bank not to pay or certify a certain check.