Once a MNC Decides to Undertake a Foreign Project, It

question 17

Multiple Choice

Once a MNC decides to undertake a foreign project, it can take various measures to minimize its exposure to political risk. These include

• A)the MNC can form a joint venture with a local company.
• B)the MNC may also consider forming a consortium of international companies to undertake the foreign project.
• C)the MNC can use local debt to finance the foreign project.
• D)the MNC may purchase insurance against the hazard of political risk.
• E)all of the above

---

Definitions:

Inflation Rates

An indicator of how quickly the overall price level for goods and services increases, leading to a decline in purchasing power.

Unemployment Rate

The percentage of the labor force that is jobless and actively seeking employment, used as a key indicator of labor market health.

Natural Rate

often references the natural rate of unemployment, which is the level of unemployment consistent with sustaining a stable rate of inflation.

Short-run Phillips Curve

A curve depicting the inverse relationship between the rate of inflation and the unemployment rate in the short term, suggesting a trade-off between the two.