Question

Explain the financial structure of foreign subsidiaries of MNCs

Answer 1

Subsidiaries of Multinational companies have to face investment restrictions in the host country.

Subsidiaries of Multinational companies also face interest rate fluctuations on the loans taken in the host country.

Remittances of MNC subsidiaries depend upon the prevailing currency rate in the host Nation.

Capital raising structure of MNC companies depends on the attitude of the government.

Ratio of capital raised by Debt financing also depends on taxation laws used in the host Nation.