Since Shareholders of MNCs May Indirectly Benefit from Corporate International

question 5

Multiple Choice

Since shareholders of MNCs may indirectly benefit from corporate international diversification,

• A)therefore firms are motivated to undertake FDI for the purpose of providing shareholders with diversification services.
• B)therefore firms are motivated to undertake FDI for the purpose of being part of the global minimum variance portfolio.
• C)therefore firms are motivated to undertake FDI for the purpose of staying on the efficient frontier.
• D)none of the above

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Definitions:

Opportunity Cost

The cost of choosing one alternative over another, representing the benefits you could have received by taking the next best alternative.

Production Possibilities

Production possibilities represent the different combinations of goods and services that a society can produce, given its available resources and technology, demonstrating trade-offs and opportunity costs.

Opportunity Cost

Surrendering the potential for benefits from different routes when opting for a specific path.

Production Possibilities Frontier

A chart illustrating the maximum production potential for two or more items, considering a specific amount of inputs.