One technique a multinational may use to avoid the blocked fund strategy of a foreign nation is for the parent to lend funds to the affiliate.The loan is known as a ________ loan.

Question

Quizplus · Accepted Answer

Fronting loans involve the parent company lending money to a third party, which then lends the money to the foreign affiliate. This helps bypass restrictions on direct fund transfers between the parent company and its foreign affiliate.

One Technique a Multinational May Use to Avoid the Blocked