One Strategic Reason That Multinational Corporations Move to Developing Countries

question 58

Multiple Choice

One strategic reason that multinational corporations move to developing countries is that __________.

• A) there are fewer regulations, which translates into more profits
• B) the unemployment rate is much higher in developing countries
• C) more regulations make factories safer for workers
• D) there are fewer job seekers in the United States.
• Answer A

Grasp the concept of response strategies to the global environment.

Know important international agreements and organizations affecting global operations.

Understand the basic characteristics and rights associated with common and preferred stocks.

Comprehend the concept and implications of dividend policy and its effect on shareholder value.

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Definitions:

Perfect Competition

A market structure characterized by an infinite number of small firms, identical products, no barriers to entry or exit, and perfect information, leading to price takers.

Patents and Copyrights

Legal protections for inventors and creators to exclusively commercialize their innovations and creative works for a certain period.

Barriers to Entry

Economic, procedural, regulatory, or technological factors that obstruct or restrict the ability of new competitors to enter and compete in an industry.

Price Takers

Economic agents in a market who accept the prevailing market price as given because they have no power to influence it.