If a Mexican company forms a new subsidiary in the U.S. but the subsidiary cannot obtain a U.S. bank loan, the company might want to obtain funding by ________.
A) issuing equity
B) using a back-to-back loan
C) using internal funding
D) borrowing locally

Question

Quizplus · Accepted Answer

A back-to-back loan involves two companies in different countries borrowing each other's currency, which can help the subsidiary obtain funding without needing a U.S. bank loan.

If a Mexican Company Forms a New Subsidiary in the U.S