When an Affiliate in One Country Does Business with Customers

question 24

True/False

When an affiliate in one country does business with customers in another,it is operating in the foreign environment.

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Definitions:

Financial Leverage

The use of borrowed money (debt) to amplify the potential returns from an investment.

EBIT-EPS Analysis

A tool used to determine the impact of different levels of debt on a company's earnings before interest and tax (EBIT) and earnings per share (EPS).

Leverage

The use of borrowed funds to finance the purchase of assets or increase the potential return of an investment.

Management Effectiveness

A measure of how well a company's management team utilizes resources to generate profits.