IBUS 401 Exam Study Guide –
Practice Questions with Verified
Answers. GRADED A+. Latest
2026/2027 Update
When evaluating international project cash flows, which of the following factors is
relevant
- future inflation
- blocked funds
- exchange rates
- all of the above - Answer✔✔ -all of the above
A US-based MNC has just established a subsidiary in Algeria. Shortly after the
plant was built, the MNC determines that its exchange rate forecasts, which had
previously indicated a slight appreciation in the Algerian dinar, were probably
false. Instead of a slight appreciation, the MNC now expects that the dinar will
depreciate substantially due to political turmoil in Algeria. This new development
, -
would likely cause the MNC to _______ its estimate of the previously computed
net present value. - lower
- increase
- lower, but not necessarily if the mNC invests enough in Algeria to offset the
decrease in NPV
- increase, but not necessarily if the MNC reduces its investment in Algeria by an
offsetting amount - Answer✔✔ -lower
Other tings 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 _________.
- appreciate; low
appreciate; high
- depreciate; high
- depreciate; low - Answer✔✔ -appreciate; low
Which of the following is a reason to consider international business?
- economies of scale
- exploit monopolistic advantages
- diversification
- all of the above - Answer✔✔ -all of the above
Practice Questions with Verified
Answers. GRADED A+. Latest
2026/2027 Update
When evaluating international project cash flows, which of the following factors is
relevant
- future inflation
- blocked funds
- exchange rates
- all of the above - Answer✔✔ -all of the above
A US-based MNC has just established a subsidiary in Algeria. Shortly after the
plant was built, the MNC determines that its exchange rate forecasts, which had
previously indicated a slight appreciation in the Algerian dinar, were probably
false. Instead of a slight appreciation, the MNC now expects that the dinar will
depreciate substantially due to political turmoil in Algeria. This new development
, -
would likely cause the MNC to _______ its estimate of the previously computed
net present value. - lower
- increase
- lower, but not necessarily if the mNC invests enough in Algeria to offset the
decrease in NPV
- increase, but not necessarily if the MNC reduces its investment in Algeria by an
offsetting amount - Answer✔✔ -lower
Other tings 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 _________.
- appreciate; low
appreciate; high
- depreciate; high
- depreciate; low - Answer✔✔ -appreciate; low
Which of the following is a reason to consider international business?
- economies of scale
- exploit monopolistic advantages
- diversification
- all of the above - Answer✔✔ -all of the above
