Explain how rate risk, political risk, transfer pricing, and strategic risk can affect capital budgeting in a company


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Explain how rate risk, political risk, transfer pricing, and strategic risk can affect capital budgeting in a company


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Capital budgeting can be affected by exchange rate risk, political risk, transfer pricing, and strategic risk. Select a sector and specific company in the mid- large size range, and explain how each of these factors can affect capital budgeting. Which of these factors provides the greatest impact to your selected organization? What measure might one take to reduce adverse impacts of any or all of these factors?