A company's risk of loss of assets, earning power, or managerial control due to politically based events or actions by host governments is referred to as _________.
A)MFN
B)political risk
C)tariffs
D)political instability
E)terrorism

Question

Quizplus · Accepted Answer

Political risk refers to the risk faced by a multinational corporation with operations in a foreign country of losing assets, earning power or managerial control due to politically based events or actions by host governments. MFN stands for most-favored-nation status and tariffs refer to taxes on imported or exported goods. Political instability and terrorism are related to political risk, but are more specific types of events that could cause a company to experience a loss.

A Company's Risk of Loss of Assets, Earning Power, or Managerial