A risk-averse firm would prefer to borrow ____ when the expected financing costs are similar in a foreign country as in the local country.
A) locally
B) in the foreign country
C) either A or B
D) part of the funds locally, and part from the foreign country

Question

Quizplus · Accepted Answer

A risk-averse firm would prefer to borrow locally when the expected financing costs are similar in a foreign country as in the local country because local borrowing reduces the firm's foreign exchange risk.

A Risk-Averse Firm Would Prefer to Borrow ____ When the Expected