When a Multinational Affiliate Replicates Production in a Foreign Country

question 57

Multiple Choice

When a multinational affiliate replicates production in a foreign country it is called ________ foreign direct investment.

• A) horizontal
• B) vertical
• C) transitional
• D) bisectional
• E) direct

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Definitions:

Stock Repurchase

The process of a corporation repurchasing its own stocks from the market to potentially boost the value of the remaining stocks.

Excess Cash

Additional cash held by a business that exceeds its operational and investment needs.

Earnings Per Share

A financial metric that measures the total earnings available to shareholders divided by the number of shares outstanding.

Debt/Equity Ratio

A ratio demonstrating the comparative levels of shareholders' equity and borrowed funds deployed to finance company assets.