Other things being equal, firms from a particular home country will engage in more international acquisitions if they expect foreign currencies to ____ against their home currency, and if their cost of capital is relatively ____.

Question

Quizplus · Accepted Answer

Firms are more likely to engage in international acquisitions if they expect foreign currencies to appreciate against their home currency, as this would increase the value of their foreign investments. Additionally, a low cost of capital makes it cheaper for firms to finance these acquisitions.

Other Things Being Equal, Firms from a Particular Home Country