Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

An MNE disposes of a greater capacity than a domestic firm to achieve an optimal cost of funds. Identify the answer which can justify this

An MNE disposes of a greater capacity than a domestic firm to achieve an optimal cost of funds. Identify the answer which can justify this statement.
A. An MNE is more diversified geographically, it generates cash flows from different line of business, thus the variability of its cash flows is minimized.
B. Commercial banks offer better financing conditions to MNEs than capital markets specially when an MNE equity security is receiving an investment grade rating.
C. An MNE is not limited to its domestic market, it can issue securities in more segmented market and with more liquidity.
D. International portfolio investors expect that MNEs to adopt global norms. MNEs are known to attract talented employee which are better equipped to manage their foreign exchange risk exposure.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Introduction To Institutions Management And Investments

Authors: Herbert Mayo

10th International Edition

1111820643, 9781111820640

More Books

Students also viewed these Finance questions

Question

Define self-esteem and explain its importance.

Answered: 1 week ago