题目内容

A ________ transaction in the foreign exchange market requires delivery of foreign exchange at some future date.

A. currency
B. forward
C. spot
D. swap

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When a foreign project is analyzed from the parent's point of view, the additional risk that stems from it "foreign" location is typically measured by _________ or ________.

A. adjusting the timing; adjusting the cash flows
B. adjusting the discount rates; adjusting the cash flows
C. adjusting the discount rates; adjusting the timing
D. none of the above

Which of the following statements is NOT true regarding MNEs when compared to purely domestic firms?

A. MNEs have higher agency costs
B. MNEs tend to rely more on short and intermediate term debt.
C. MNEs have greater costs of asymmetric information.
D. MNEs have greater foreign exchange risk.

Tax-haven subsidiaries are typically established in a country that can meet the following requirements_____________.

A. a stable government that encourages the establishment of foreign-owned financial and service facilities within its borders
B. the facilities to support financial services, for example, good communications, professional qualified office workers, and reputable banking services
C. a low tax on foreign investment or sales income earned by resident corporations and a low dividend withholding tax on dividends paid to the parent firm.
D. all of the above

Bacon Signs Inc. is based in a country with a territorial approach to taxation but generates 100% of its income in a country with a worldwide approach to taxation. The tax rate in the country of incorporation is 25%, and the tax rate in the country where they earn their income is 50%. In theory, and without any special provisions in the tax laws of either country, Bacon should pay taxes at a rate of_______________.

A. 62.5%
B. 0%
C. 50%
D. 75%

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