In general, MNCs probably prefer to use ____ foreign debt when their foreign subsidiaries are subject to potentially ____ local currencies.
A) more; strong
B) more; weak
C) less; strong
D) less; weak
E) B and D

Question

Quizplus · Accepted Answer

MNCs prefer to use more foreign debt when local currencies are weak because it can be cheaper to repay the debt if the local currency depreciates further.

In General, MNCs Probably Prefer to Use ____ Foreign Debt