When Evaluating a Foreign Investment Project, It Is Important for the MNC

question 95

Multiple Choice

When evaluating a foreign investment project, it is important for the MNC to consider the effect of political risk, as a sovereign country can change "the rules of the game". To account for this

• A)the MNC may adjust the cost of capital upward.
• B)the MNC may lower the expected cash flows from the foreign project.
• C)the MNC may purchase insurance policies against the hazard of political risks.
• D)all of the above

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Definitions:

Digital Filing System

An electronic system for organizing, storing, and retrieving digital documents or files.

Documents

Written, printed, or electronic records that provide information or evidence of transactions, activities, or concepts.

Sustainable Business Practices

Practices adopted by companies aimed at creating positive impacts on the environment, society, and economy, ensuring long-term business success without harming ecological and socio-economic systems.

International Company

A business enterprise that operates in multiple countries beyond its original or home country.