The risk that a foreign country where an MNC does business might take action that would adversely affect the MNC is called:
A)political risk.
B)nationalization.
C)privatization.
D)economic risk.

Question

Quizplus · Accepted Answer

Political risk refers to the risk of a foreign government taking actions that negatively affect the operations and profitability of an MNC. This could include nationalization of assets, expropriation of property, imposition of trade barriers, or political instability resulting in business disruptions. Economic risk, on the other hand, refers to the risk of fluctuations in exchange rates, inflation, or interest rates that could impact an MNC's financial performance. Nationalization and privatization are specific actions that a government might take, rather than a general category of risk.

The Risk That a Foreign Country Where an MNC Does