The valuation of an MNC is reduced if the required rate of return on its investments in foreign countries is reduced.

Question

Quizplus · Accepted Answer

The valuation of an MNC is actually increased if the required rate of return on its investments in foreign countries is reduced. This is because a lower required rate of return means that the investments are seen as less risky, which in turn increases the net present value of future cash flows and thus increases the overall valuation of the company.

The Valuation of an MNC Is Reduced If the Required