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      Question

      The risk that arises from political instability,

      regulatory changes, and economic fluctuations in a particular country that may affect foreign investments is referred to as:
      A Market Risk Correct Answer Incorrect Answer
      B Credit Risk Correct Answer Incorrect Answer
      C Country Risk Correct Answer Incorrect Answer
      D Operational Risk Correct Answer Incorrect Answer
      E Liquidity Risk Correct Answer Incorrect Answer

      Solution

      Country risk refers to the threats investors face due to political and economic uncertainties in a foreign country, impacting returns on investments.

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