The Strategic Behavior Theory Is Used to

question 19

Multiple Choice

The strategic behavior theory is used to

• A) explain the constraints of exporting and licensing.
• B) explain the challenges faced by a firm during the establishment of a new operation in a foreign country.
• C) explain the patterns of FDI flows based on the idea that FDI flows are a reflection of strategic rivalry between firms in the global marketplace.
• D) review the theories that have been used to explain foreign direct investment.
• E) explain how greenfield investments are better than FDI at determining strategic competition and dominance.

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Definitions:

Competitive Advantage

The attributes or conditions that allow an organization to produce goods or services more effectively than its competitors.

Product Differentiation/Innovation

The process of distinguishing a product or service from others in the market to make it more attractive to a particular target market.

USMCA

The United States–Mexico–Canada Agreement, a trade deal that replaced NAFTA to govern trade relations between these three countries.

Tariff Barriers

Taxes or duties imposed on imported or exported goods to regulate trade and protect domestic industries from foreign competition.