Which of the Following Is a Drawback of Direct Exporting

question 9

Multiple Choice

Which of the following is a drawback of direct exporting?

• A) Servicing the business will demand more responsibility from every level in the organization.
• B) The profits of a business will be lower, and control over foreign sales is lost.
• C) The opportunity to tailor its offerings to the customer's evolving needs is lost.
• D) The owner knows whom to contact if something is not working.
• E) The long-term outlook and goals for an export program can change rapidly, and it is hard to redirect efforts accordingly.

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Definitions:

Average Fixed Cost

The total fixed costs divided by the number of units produced, representing how fixed costs dilute with increased production.

Marginal Cost

Marginal cost is the increase or decrease in the total cost that arises when the quantity produced is incremented by one unit.

Average Variable Cost

The cost of production that varies with the output level, calculated by dividing the total variable costs by the number of units produced.

Average Product

is the output per unit of input, such as the quantity of goods produced per labor hour, and is used to measure productivity.