C123

The commonly accepted goal of the MNC is to

• Maximize short-term earnings

• Maximine shareholder wealth

• MInimize risk

• Maximize international sales

The commonly accepted goal of the MNC is to

• Maximize short-term earnings

• Maximine shareholder wealth

• MInimize risk

• Maximize international sales

For the MNS, agency costs are typically

• non-existent

• larger than agency cost of a small purely domestic firm

• smaller than agency cost of a small purely domestic firm

• the same as agency cost of a small purely domestic firm

Which of the following could reduce agency problem for an MNC?

• stock options as mangerial compensation

• hostile takeover threat

• investor monitoring

• all of the above are forms of corporate control that could reduce agency problems for an MNC

The valuation of an MNC should rise when an event causes the expected cash flows from foreign to ____ and when foreign currencies denominating these cash flows are expected to___

• decrease;appreciate

• increase; appreciate

• decrease; depreciate

• increase; depreciate

Which of the following theories identifies specialization as a reason for international business

• theory of comparative advantage

• imperfect market theory

• product cycle theory

• non of the above

Which of the following theories identifies the non-transferability of the resources as a reason for international business

• theory of the comparative advantage

• imperfect markets theory

• product cycle theory

• none of the above

Which of the following theories suggests that firms seek to penetrate new markets over time?

• theory of comparative advantage

• imperfect markets

• product cycle

• none of the above

Which of the following industries would most likely take advantage of lower costs in some less developed foreign countries?

• assembly line production

• specialized professional services

• nuclear misslie planning

• planning for more sophisticated computer technology

Due ti the risks involved in the international business, firms should

• only consider international business in major countries

• maintain international business to no more than 20% of total business

• maintain international business to no more than 35% of total business

• none of the above