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A host government may offer incentives to MNCs that consider direct foreign investment in its country. Incentives may include all of the following, with the exception of:
reduced regulations
tax breaks on income earned in the host country
tax breaks on income remitted to home country
low-interest loans
none of the above
A U.S. firm is considering investment in either Canada or Mexico, but not both. It might select:
Canada, because the U.S. dollar is expected to depreciate against the Canadian dollar
Mexico, because the peso is expected to depreciate against the U.S. dollar
Mexico, because the U.S. dollar is expected to appreciate against the peso
Canada, because the Canadian dollar is expected to depreciate against the U.S. dollar
none of the above
MADCO, a U.S. company, exports to other countries. The company sells its accounts receivable without recourse. Factoring involves:
purchase of accounts receivable by a factor
accounts payable financing
working capital financing
countertrade
none of the above
A MNC could do which of the following to make it desirable to the host government:
use local employees for managerial positions
purchase supplies in the host country
Reinvest profits in the host country
all of the above
none of the above
A MNC might establish a manufacturing facility in a foreign country because:
labor costs are lower
tax rates are lower
the host government offers incentives
expenses are lower
all of the above
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