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18 June, 17:02

Eurenasia is a country that has frequently been assigned low macro-assessment ratings of country risk in the recent past due to its tendency to war with neighboring nations. MNC A is considering the establishment of a subsidiary to manufacture personal computers, while MNC B is considering the establishment of a subsidiary to manufacture tanks. Which of the two MNCs is likely to be less affected by the low macro-assessment?

a. MNC A. b. MNC B. c. both will be equally affected, since the macro-assessment does not vary. d. none of the above

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  1. 18 June, 20:58
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    Eurenasia is a country that has frequently been assigned low macro-assessment ratings of country risk in the recent past due to its tendency to war with neighboring nations. MNC A is considering the establishment of a subsidiary to manufacture personal computers, while MNC B is considering the establishment of a subsidiary to manufacture tanks. Which of the two MNCs is likely to be less affected by the low macro-assessment?

    Option B is correct - MNC B will be less affected by low macro-assessment.

    Explanation:

    Due to the tendency of Eurenasi to war with neighboring countries, the manufacture of tanks by MNC B will be less affected by low macro-assessment because, during war periods, tank sales will increase. Whereas, Low macro assessment will affect MNC A because it selling computers will be affected by war.

    Therefore, Option B is correct - MNC B will be less affected by low macro-assessment.
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