Which of the Following Is an Advantage to Exporting Goods

question 35

Multiple Choice

Which of the following is an advantage to exporting goods to reach international markets rather than entering into some form of FDI?

• A) fewer agency costs
• B) fewer direct advantages from research and development
• C) a greater risk of losing markets to copycat goods producers
• D) an inability to exploit R&D as effectively as if also invested abroad

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Definitions:

European Banks

Financial institutions operating in Europe, subject to the region's regulatory frameworks, providing a range of banking and financial services.

American Firm

A company that is incorporated or has its principal operations in the United States of America.

Consolidated Books

Financial records that combine the assets, liabilities, and operating accounts of parent and subsidiary companies into one set of statements.

Translation Loss

A decrease in the value of foreign currencies held by a company because of changes in exchange rates, affecting the financial statements when consolidating.