An MNC may deviate from its target capital structure in each country where financing is obtained, yet still achieve its target capital structure on a consolidated basis.

Question

Quizplus · Accepted Answer

This statement is true. A multinational company may have varying capital structures in different countries where it obtains financing, based on factors such as local laws, tax policies, and market conditions. However, on a consolidated basis, the company can still achieve its overall target capital structure by managing its debt and equity levels across all its operations.

An MNC May Deviate from Its Target Capital Structure in Each