Some of the risks that a Canadian based MNC can encounter in its foreign investments are: (i)- an increase in the cost of borrowing due to a rise in interest rates.
(ii)- increase in inflation rates.
(iii)- dumping.
(iv)- unfair competition by local companies.
(v)- inconvertibility of foreign currencies.
(vi)- expropriation.
(vii)- destruction of properties due to war,revolution,and other violent political events in foreign countries.
(viii)- loss of business income due to political violence.
In Canada,the Export Development Canada (EDC)offers insurance against which of the above:
A) (i), (ii), (iii), and (iv)
B) (v), (vi), (vii), and (viii)
C) (iv), (v), (vi), and (vii)
D) None of these.

Question

Quizplus · Accepted Answer

Export Development Canada (EDC) offers insurance against risks that are typically beyond the control of the investor, such as inconvertibility of foreign currencies (v), expropriation (vi), destruction of properties due to war, revolution, and other violent political events (vii), and loss of business income due to political violence (viii). These are risks associated with the political and economic environment in foreign countries.

Some of the Risks That a Canadian Based MNC Can