Domestic firms rely much more heavily on short and intermediate debt, which lie at the low cost end of the yield curve, than do MNEs.

Question

Quizplus · Accepted Answer

Domestic firms often have more limited access to international capital markets and therefore rely more on borrowing from domestic sources, which tends to be at lower interest rates on short and intermediate-term debt. MNEs, on the other hand, may have more diverse funding sources and may be able to access longer-term debt at lower rates in global financial markets.

Domestic Firms Rely Much More Heavily on Short and Intermediate