Forecasts, yield curve, weighted average cost, WACC
Not what you're looking for?
1) Point-estimate exchange rate forecasts cannot adequately account for the potential impact of exchange rate fluctuations True or False
2) Country risk can be used:
I. to monitor countries where the MNC is presently doing business.
II. as a screening device to avoid conducting business in countries with excessive risk.
III. compare levels of success based on consumer attitudes toward one's product.
IV. to improve the analysis used in making long-term investment or financing decisions.
A) I, II, III and IV
B) I, II and IV only
C) II, III, and IV only
D) I and III only
E) I and IV only
3. Which of the following would not be a reason for differences in the cost of capital between an MNC and a purely domestic firm?
A) Capital structure being used.
B) Size of firm.
C) Exposure to Country risk.
D) Diversification of financing sources.
4) A yield curve where short term rates are lower than long-term rates is said to be:
A) An inverse yield curve.
B) A flat yield curve.
C) A positive yield curve.
D) A negative yield curve.
5) As additional debt is utilized in a firm's capital structure, the weighted average cost of capital (WACC) should:
A) Rise.
B) Fall.
C) Stay the same.
D) Fall, then rise past a certain point.
Purchase this Solution
Solution Summary
This post has multiple questions addresses exchange rate forecasts, yield curve, weighted average cost of capital and country risk. It discusses about the reason for differences in the cost of capital between an MNC and a purely domestic firm.
Solution Preview
1) Point-estimate exchange rate forecasts cannot adequately account for the potential impact of exchange rate fluctuations
Answer: True
2) Country risk can be used:
I. to monitor countries where the MNC is presently doing business.
II. as a screening device to avoid conducting business in countries ...
Purchase this Solution
Free BrainMass Quizzes
Marketing Research and Forecasting
The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.
Six Sigma for Process Improvement
A high level understanding of Six Sigma and what it is all about. This just gives you a glimpse of Six Sigma which entails more in-depth knowledge of processes and techniques.
Organizational Leadership Quiz
This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.
Basics of corporate finance
These questions will test you on your knowledge of finance.
Motivation
This tests some key elements of major motivation theories.