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1-A firm that located in a country that experience highly economic growth would most likely have access to________ level of capital than others, and as
1-A firm that located in a country that experience highly economic growth would most likely have access to________ level of capital than others, and as a result the cost of capital will be _________.
A. | low, high | |
B. | high, low. | |
C. | low, low. | |
D. | high, high. |
2-What method used to estimate the MNE's cost of debt that include currency and exchange rate risks?
A. | Weighted Average Cost of Capital (WACC). | |
B. | Fisher Effect. | |
C. | Capital Asset Pricing Model (CAPM). | |
D. | Net Present Value (NPV). |
3-When investing into a foreign country, an investor would require a risk premium which is
A. | The excess return of the foreign governmental bond yields over domestic bond yields. | |
B. | It is the reflection of political, economic & financial risks. | |
C. | Both A & B is correct. | |
D. | None of the above is correct. |
4-The main reason for International portfolio diversification is
A. | Increased returns due to higher levels of risk. | |
B. | Increased exposure to country-specific risks. | |
C. | Increased correlation between asset returns in different countries. | |
D. | Reduced overall portfolio risk through exposure to non-correlated assets. |
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