Which one of the following is NOT a form of direct political risk to the multinational corporation?

a.

currency controls

b.

changes in tax or labor laws

c.

none of the other options are a form of direct political risk

d.

regulatory restrictions

e.

privatization of public utilities

The International Fisher Effect refers to:

Select one:

a.

Currencies with high rates of inflation should bear higher interest rates than currencies with lower inflation

b.

An investment in the domestic economy should obtain the same return as an investment overseas

c.

Countries with low interest rates are expected to appreciate relative to currencies with high interest rates

d.

The cost of purchasing the same good in one country should be the same as the cost in another country