Which of the Following Would an MNE NOT Want to Do

question 47

Multiple Choice

Which of the following would an MNE NOT want to do?

• A) Pay a very low fixed rate of interest in the long term.
• B) Swap into a foreign currency payment that is falling in value.
• C) Swap into a floating interest rate receivable just prior to interest rates going up.
• D) Swap into a fixed interest rate receivable just prior to interest rates going up.

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Definitions:

Energy Minima

Points in a potential energy surface that represent stable states of a system, where any small displacement of particles leads to an increase in potential energy.

Dihedral Angle

The angle between two planes defined by four atoms, often used to describe the orientation of parts of a molecule relative to each other.

Steric Strain

A form of strain in molecules resulting from repulsive interactions when atoms are forced too close to one another, influencing molecule stability and reactivity.

Torsion Strain

Internal strain in a molecule caused by the electron cloud repulsions when bonds are twisted away from their preferred angles.