Repatriation of Funds Is Not Relevant in Multinational Capital Budgeting

question 109

True/False

Repatriation of funds is not relevant in multinational capital budgeting analysis as the funds generated in foreign countries can be reinvested in that country generating larger cash flows for the parent company.

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Definitions:

Trade Barriers

Measures implemented by governments to restrict or discourage international trade, such as tariffs, quotas, and embargoes.

Economic Growth

An increase in the production of goods and services in an economy over a period of time, indicative of a thriving economic condition.

Euro

The official currency of the Eurozone, which is used by many of the member states of the European Union.

Common Currency

A currency that is used by several countries, facilitating easier trade and economic stability within those regions; the Euro is a well-known example.