The adjusted present value (APV)model that is suitable for an MNC is the basic net present value (NPV)model expanded to:

Question

Quizplus · Accepted Answer

The APV model for an MNC is an expanded version of the basic NPV model that takes into account the specific challenges and opportunities faced by multinational corporations. These challenges include distinguishing between the market value of a levered firm and the market value of an unlevered firm, discerning the blocking of certain cash flows by the host country from being legally remitted to the parent, and considering foreign currency fluctuations or extra taxes imposed by the host country on foreign exchange remittances. Therefore, all the options (A, B, and C) are correct, making D the best choice.

The Adjusted Present Value (APV)model That Is Suitable for an MNC