There Are Vast Differences in Local Market Needs in the Consumer

question 39

Multiple Choice

There are vast differences in local market needs in the consumer soft drink business around the world. TwinFold Media, a Canadian multinational advertising agency, specializes in the soft drink industry and uses a geocentric staffing approach. What advantage would the company gain by using this approach?

• A) It tends to reduce cultural myopia and enhance local responsiveness.
• B) It is inexpensive to implement.
• C) It reduces the costs of value creation.
• D) It allows all key management positions of a firm and its subsidiaries to be filled by parent-country nationals.
• E) It requires minimal documentation for hiring foreign nationals.

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Definitions:

Marginal Cost

The increase in total cost that arises from producing one additional unit of a good or service.

Net Benefit

The total positive impact or gain subtracted by the total cost or negative impact, typically used in the analysis of business or policy decisions.

Marginal Benefit (MB)

The augmented satisfaction or usefulness obtained by consuming or producing one extra unit of a good or service.

Marginal Cost (MC)

An upsurge in the cumulative cost incurred from the production of one more unit of a product or service.