An MNC Considers Direct Foreign Investment in Germany

Multiple Choice

An MNC considers direct foreign investment in Germany. It is mainly concerned with the subsidiary's ability to generate sufficient sales there. The country risk characteristic that would have the largest direct impact on the subsidiary's sales in Germany is:

A) the host government's tax rates charged on remitted earnings.
B) the possibility of blocked funds.
C) the state of the economy in Germany.
D) the parent's cost of capital.