Question
1. Statement 1. The valuation model of an MNC shows that the MNC's value is favorably affected when its expected foreign cash inflows decrease. Statement
1. Statement 1. The valuation model of an MNC shows that the MNC's value is favorably affected when its expected foreign cash inflows decrease. Statement 2. The valuation model of an MNC shows that the MNC's value is adversely affected when the MNC's required rate of return increases. Which of the following statements is/are accurate?
A) Statement 1 only
B) Statement 2 only
C) Both statements 1 and 2
D) Neither statement is accurate
2. The economic data of country A (with currency TWC) shows that interest rates are high, while inflation remains low. Also, TWCs forward rate exhibits a discount which is attributable to the countrys relatively high-interest rates. A trader of a local FX bank decided to sell TWC since it fell below the threshold level based on the recent TWC movement. Which of the following forecast technique did the analyst use?
A) Fundamental
B) Market-based
C) Regression
D) Technical
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