A True MNC, with Operations in Dozens of Different Countries

question 25

Multiple Choice

A true MNC, with operations in dozens of different countries

• A)must effectively manage foreign exchange risk.
• B)can ignore foreign exchange risk since it is diversified.
• C)will pay taxes in only its home county.
• D)none of the above

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Definitions:

Notes Payable

Short or long-term liabilities; a written promise to pay a specified amount of money, known as the principal, along with interest, by a certain date.

Preferred Stock

A class of ownership in a corporation with a fixed dividend that is paid out before any dividends to common stockholders.

Common Equity

The amount of money that would be returned to shareholders if all the company's assets were liquidated and all its debts repaid.

Year 0 Value

Year 0 Value is a reference point in financial analysis indicating the value of an investment or project at the beginning period before any growth or decline.