Operational Risk Refers to the Risk Which Arises from the Uncertainty

question 12

Multiple Choice

Operational risk refers to the risk which arises from the uncertainty about:

• A)the host's country's policies affecting the local operations of an MNC
• B)the host's country's policy regarding ownership and control of local operations
• C)cross-border flows of capital, payment, know-how, and the like
• D)none of these

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Definitions:

Market Value

The trading price at which an asset or service can be currently bought or sold in the open market.

Coupon Rate

The interest rate stated on a bond at the issuance time, which the issuer promises to pay to the bondholder on the face value of the bond.

Coupon Yield

The per annum rate of interest a bond delivers, depicted as a proportion of its par value.

Yield to Maturity

The complete earnings projected from a bond assuming it is retained up to its expiration date.