3. Some of the risks that a U.S. based MNC can encounter in its foreign investme

Question

3. Some of the risks that a U.S. based MNC can encounter in its foreign investments are:

(i)- an increase in the cost of borrowing due to a rise in interest rates
(ii)- increase in inflation rates
(iii)- dumping
(iv)- unfair competition by local companies
(v)- inconvertibility of foreign currencies
(vi)- expropriation
(vii)- destruction of properties due to war, revolution, and other violent political events in foreign countries
(viii)- loss of business income due to political violence

In the U.S., the Overseas Private Investment Corporation (OPIC) offers insurance against which of the above:
A. (i), (ii), (iii), and (iv)
B. (v), (vi), (vii), and (viii)
C. a) and b)
D. none of the above

Explanation / Answer

B. (v), (vi), (vii), and (viii)

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