Direct Exporting Is

question 88

Multiple Choice

Direct exporting is:

• A)when a firm sells its domestically produced goods in a foreign country without intermediaries.
• B)offering the right to a trademark, patent, trade secret, or similarly valued items of intellectual property in return for a royalty or fee.
• C)when a foreign country and a local firm invest together to create a local business.
• D)contracting with a foreign firm to manufacture products according to certain specifications.

---

Definitions:

Cost of Capital

The minimum return on investment a business necessitates to uphold its market value and entice financial inflow.

Certainty Equivalent NPV

A method used to adjust the net present value (NPV) of an investment to account for risk, equating it to a certain but lower cash flow.

Cost of Capital

The investment return rate a corporation requires to sustain its market valuation and pull in investment.

Risk-Free Rate

The theoretical return on investment with no risk of financial loss, typically represented by the yield on government securities.