Reference no: EM132005648

1. Which one of these should be the primary appeal of unused debt capacity to a bidder firm?

Ability to borrow additional funds to increase management bonuses

Source of funding for negative net present value projects

Debt funding for a golden parachute

Increased funding for the payment of unsustainable dividends

Tax savings resulting from increased interest expense on additional debt

2. A country's location influences its trade relationships because:

A) Competitive advantage dictates that no contiguous countries can have the same levels of trade

B) Southern countries have to trade with northern ones due to climactic realities in the South.

C) Trade tends to occur with neighbors, often in subtle ways.

D) Proximity breeds contempt, a phenomenon that influences trade.