1. The relationship among stakeholders used to determine and control the strategic direction and performance of an organization is termed:

a. working capital management.

b. capital structure.

c. Anglo-American activism.

d. corporate governance.

2. A foreign subsidiary''s functional currency is the currency of the primary economic environment in which the subsidiary operates and in which it generates cash flows.

True

False

3. The primary objective of multinational tax planning is to minimize the firm's worldwide tax burden.

True

False

4. If a firm undertakes a project with ordinary cash flows and estimates that the firm has a positive NPV, then the IRR will be:

a. cannot be determined from this information

b. greater than the cost of capital.

c. less than the cost of capital.

d. greater than the cost of the project.

5. Under a floating exchange rate system, the government bears the responsibility to ensure that the BOP is near zero.

True

False