Multiple Choice
How can local financing help MNCs reduce country risk?
A) By raising funds locally,MNCs receive the tactic agreement of the country where the funds are raised that no government actions will be taken that will be adverse to the firm.
B) If an MNC raises funds locally,it creates local stakeholders in the MNC,and countries may be reluctant to take actions that might damage or reduce the profitability of firms that have local stakeholders.
C) If an MNC raises funds locally,it gains the support of the local capital markets which,in turn,lobby the local government not to take actions that will adversely affect firms that participate in the local capital market.
D) When an MNC raises funds locally,it automatically receives special incentives from the local government that reduce country risk.
Correct Answer:

Verified
Correct Answer:
Verified
Q40: What is the primary drawback of external
Q41: How does a syndicate affect the interest
Q42: Traditionally,the primary source of financing for firms
Q43: The cost of equity is more difficult
Q44: MNCs face some issues in arranging financing
Q45: How does a venture capital firm usually
Q46: The primary attraction of the Eurobond market
Q48: Coupon frequency on floating rate notes can
Q49: The agency costs that an MNC is
Q50: One characteristic that distinguishes MNCs from domestic