Foreign subsidiaries of U.S. MNCs can avoid exchange rate risk by financing projects with dollars.

Name: Foreign subsidiaries of U.S. MNCs can avoid exchange rate risk by financing projects with dollars.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Financing projects in dollars does not avoid exchange rate risk; it merely shifts the risk from the U.S. parent company to the foreign subsidiary, which will still face exchange rate risk when converting local currency to dollars for repayments.

Foreign Subsidiaries of U