1. Companies can reduce loss from expropriation:

A by expecting low returns from high risk foreign subsidiaries

B by establishing foreign subsidiaries in countries with volatile exchange rates

C by financing the foreign subsidiary using foreign currencies

D by obtaining insurance against economic losses form expropriation

E by investing all the funds in one foreign subsidiary

2. Which of the following is not a characteristic of preferred stock?

A All accumulated dividends owed to the preferred shares must be paid before any dividends can go to the common stock

B Preferred stock holders usually get fixed stream of dividends

C Preferred stock does not mature like a bond

D Preferred stock holders usually do not have voting rights

E In the case of a bankrupcy all debt holder would be paid after preferred shareholders