In anticipation of a foreign exchange loss, an MNE may speed up the transfer of funds out of the company via dividends. When undertaking such an activity the MNE must be concerned with all of the following EXCEPT:
A)interest rate differences between the two countries.
B)the negative impact on host country relations.
C)defection on the part of executives in the home headquarters.
D)MNEs must be concerned with all of the above.

Question

Quizplus · Accepted Answer

Defection on the part of executives in the home headquarters is not a concern when an MNE speeds up the transfer of funds out of the company via dividends in anticipation of a foreign exchange loss. However, the MNE must be concerned about interest rate differences between the two countries and the negative impact on host country relations. Overall, the MNE must be concerned with options A and B.

In Anticipation of a Foreign Exchange Loss, an MNE May