M.COM FLASHCARD II

Front

What is foreign exchange exposure?

Back

The risk of loss due to changes in foreign exchange rates

Front

Which of the following is a characteristic of a multinational corporation (MNC)?
Options:
Operations in only two countries
Operations and value-creation activities in multiple countries
Domestic sales only
Single currency transactions only

Back

Operations and value-creation activities in multiple countries

Front

What is a eurobond?

Back

A bond issued in a currency different from the country where it's issued.

Front

In international finance, what does political risk primarily refer to?

Back

Risk of government actions affecting business operations

Front

Which of the following best describes a forward contract? Options: An agreement to exchange currencies at a future date at a predetermined rate, An immediate exchange of currencies at the current market rate, A contract that gives the right but not obligation to exchange currencies, A long-term loan denominated in foreign currency

Back

An agreement to exchange currencies at a future date at a predetermined rate

Front

What is dividend policy?

Back

The framework for determining how much and when to pay dividends to shareholders.

Front

Which of the following is a disadvantage of stock dividends? They require cash outflow, They increase the number of shares outstanding, They reduce earnings per share, They are taxed immediately

Back

They reduce earnings per share

Front

Which factor is NOT typically considered in setting dividend policy? Legal restrictions, Company's growth opportunities, Available cash flow

Back

Competitors' stock prices

Front

Which factor is NOT typically considered in setting dividend policy? Legal restrictions, Company's growth opportunities, Available cash flow

Back

Competitors' stock prices

Front

What is a stock repurchasing?

Back

When a company buys back its own shares from the market