A multinational firm can be defined as a firm that
A)invests short-term cash inflows in more than one currency.
B)has sales affiliates in several countries.
C)is incorporated in more than one country.
D)incorporated in one country and has production and sales operations in several other countries.

Question

Quizplus · Accepted Answer

A multinational firm is typically defined as a company that is incorporated in one country (the home country) and has production and sales operations in several other countries (host countries). This distinguishes it from a purely domestic firm that only operates within the borders of its home country. Option A describes a firm that engages in currency hedging or management; Option B describes a company with sales affiliates in multiple countries but doesn't necessarily have physical operations in those countries; and Option C describes a company that is incorporated in more than one country, but doesn't necessarily have operations in multiple countries.

A Multinational Firm Can Be Defined as a Firm That