According to Your Authors, Diversifying Cash Flows Internationally May Help

question 8

Multiple Choice

According to your authors, diversifying cash flows internationally may help MNEs reduce the variability of cash flows because:

• A) of a lack of competition among international firms.
• B) of an offset to cash flow variability caused by exchange rate variability.
• C) returns are not perfectly correlated between countries.
• D) none of the above

---

Definitions:

Perestroika

A political movement for reform within the Communist Party of the Soviet Union during the 1980s, aimed at restructuring the Soviet economy and government.

Economic Reforms

Changes to economic policies or structures, typically intended to improve efficiency, growth, and the equitable distribution of resources.

Material Incentives

Benefits or rewards of a tangible nature, such as money or goods, used to motivate individuals towards certain behaviors or actions.

Competing Claims

Situations where two or more parties assert rights to the same resource or territory, often leading to conflict.