Week 4 UEE

Question 1

What is a strategic benefit of using country risk assessments in global expansion planning?

Accepted Answer

It helps firms choose safer and more stable markets

Question 2

What is typically included in a comprehensive country risk assessment framework?

Accepted Answer

Political, economic, and financial risk indicators

Question 3

What could happen if a company ignores country risk in its international expansion?

Accepted Answer

It may suffer financial losses or be forced to exit the market

Question 4

Why is foreign exchange stability a critical factor in country risk assessments?

Accepted Answer

Volatile exchange rates increase uncertainty in returns and pricing

Question 5

Which combination of factors would most likely increase a country’s overall risk rating?

Accepted Answer

High inflation, political unrest, high unemployment

Question 6

Which risk element is most associated with a sudden change in government or regime?

Accepted Answer

Political risk

Question 7

Which macroeconomic factor is commonly analysed in a country risk assessment?

Accepted Answer

GDP growth rate

Question 8

Why is country risk assessment important for international business?

Accepted Answer

It identifies potential political and economic threats

Question 9

Why is inflation a key concern in assessing country risk?

Accepted Answer

It can erode purchasing power and destabilise the economy

Question 10

How does country risk assessment influence foreign direct investment (FDI)?

Accepted Answer

High risk may deter investors due to uncertainty and potential losses

Questions 10