Which of the Following Statements Is NOT True Regarding MNEs

question 51

Multiple Choice

Which of the following statements is NOT true regarding MNEs when compared to purely domestic firms?

• A) MNEs tend to rely more on short and intermediate term debt.
• B) MNEs have greater foreign exchange risk.
• C) MNEs have greater costs of asymmetric information.
• D) MNEs have higher agency costs.

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Definitions:

Absolute Scale

A scale of measurement that has a fixed zero point and equal intervals, allowing for meaningful comparisons and calculations.

Game Theory

A field of study focused on mathematical models of strategic interaction among rational decision-makers.

Strategic Decision Making

The process of making choices by identifying a decision, gathering information, and assessing alternative resolutions that align with a long-term goals.

Cooperative Games

A branch of game theory where players can negotiate and form coalitions to maximize their benefits.