A Firm May Narrow Its Focus to a Specific Region

question 65

Multiple Choice

A firm may narrow its focus to a specific region of the world in order to:

• A) decrease the pressures on managers to coordinate efforts on a worldwide basis.
• B) obtain greater economies of scale.
• C) better understand cultures,legal and social norms,and other factors that are important to effective competition in local markets.
• D) avoid depleting financial resources in markets where the firm may not be successful.

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Definitions:

FIFO

"First In, First Out," an inventory valuation method where goods first bought are the first to be sold, affecting the costs reported in the financial statements.

Gross Profit

The difference between revenue and the cost of goods sold before deducting selling, general, and administrative expenses.

Net Income

The net income of a company, which is calculated by deducting all costs and taxes from the total revenue.

Incidental Costs

Minor or secondary costs that are associated with purchasing or manufacturing a product but not directly allocable to production costs.