________ Is a Method of Going Global in Which a Company

question 5

Multiple Choice

________ is a method of going global in which a company makes agreements with producers in the foreign market to produce its product or provide its service.

• A) Contract manufacturing
• B) Direct investment
• C) Acquisition
• D) Exporting
• E) Management contracting

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Definitions:

Required Rate

The minimum return that investors expect to earn from an investment, determining the value of an investment.

Variable Cost

Costs that vary directly with the level of production or output, such as raw materials and labor expenses, adjusting as the volume of production increases or decreases.

Credit Policy

Guidelines that a company follows to determine the creditworthiness of customers and the terms and conditions for extending credit.

Incremental Cash Flow

The extra money a company gains by embarking on a project or investment.