Question

7. ______ Which of the following is NOT a factor that should be considered in multinational capital budgeting? a. Blocked funds. b. Exchange rate fluctuations. c. Inflation. d. All of these should be considered. e. None of these should be considered.

Answer 1

D. All of these should be considered

Step-by-step explanation:

Factors considered in multinational budgeting includes

1. Blocked funds

2. Exchange rate fluctuations

3. Inflation

4. Financing arrangements

5. Host government incentives

Answer 2

The correct answer is D: All of these should be considered.

Step-by-step explanation:

The following is a list of things to be considered in a multinational capital budgeting:

1. Exchange rate fluctuations. Different scenarios should be considered together with their probability of occurrence.
2. Inflation
3. Financing arrangement
4. Blocked funds
5. Uncertain salvage value
6. Impact of project on prevailing cash flows
7. Host government incentives

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