Which of the Following Is an Example of a "Greenfield

question 47

Multiple Choice

Which of the following is an example of a "greenfield" investment?

• A) Nike contracts with a footwear company in China to make athletic shoes.
• B) A Chinese oil company buys a U.S. oil company.
• C) Toyota, a Japanese automaker, builds an assembly plant in Ohio.
• D) Daimler, a German automaker, merges with Chrysler, a U.S. automaker.

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Definitions:

Cost of Debt

The effective rate that a company pays on its current debt, including loans and bonds.

Repurchasing Stock

When a company buys back its own shares from the marketplace, reducing the amount of outstanding stock.

All Equity Firm

A company that finances all of its operations, investments, and assets through stock equity rather than taking on any debt.

Closely Held

Refers to a company that has a small group of controlling shareholders, with limited public trade of its shares.