Which of the following statements is TRUE?

Question $15$ options:

Purely domestic firms tend to have higher political risk in relation to MNEs.

It is common for MNEs to apply their domestic rules and regulations when doing financial business in a foreign country because of different financial regulations and customs in different countries.

Thanks to the ability to bear the higher risk presented by financial instruments, domestic firms tend to use more financial derivatives than MNEs.

Due to foreign complexities, MNEs must modify finance theories such as cost of capital and capital budgeting.