Firms operating in some countries are exposed to political risks. What are the primary types of political risks? Explain each of them and provide some examples.
An online source noted that political risk is the risk that an investment's returns could suffer as a result of political changes or instability in a country. This instability that may affect investment returns could have resulted from change in government, legislative bodies, other foreign policy makers, or military control. The same source further pointed out that political risk becomes more of a factor as duration of investment becomes ...