The host country's balance-of-payments problem tends to worsen when foreign firms:
A)invest solely in capital-intensive industries.
B)repatriate their profits to the headquarters from the host country.
C)acquire the foreign operations in order to diversify corporate investment holdings.
D)refuse to share technological expertise with the host country.
E)export all products to other countries.

Question

Quizplus · Accepted Answer

Repatriating profits to the headquarters from the host country reduces the amount of foreign currency available in the host country, which worsens the balance-of-payment problem.

The Host Country's Balance-Of-Payments Problem Tends to Worsen When Foreign