Which of the Following Is an Inherent Disadvantage to Being

question 53

Multiple Choice

Which of the following is an inherent disadvantage to being a multinational enterprise?

• A)An MNE does not initially have the native understanding of local laws, customs, procedures, practices, and relationships.
• B)An MNE does not have the same assets as those held by its local competitors in the host market.
• C)An MNE does not enjoy comparative advantages in the same goods as those of its local competitors in the host market.
• D)An MNE's profits are doubly taxed by two governments.

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Definitions:

Fair Value

The amount one would expect to get from selling an asset or the cost to transfer a liability during a regulated transaction involving parties in the market.

Directly Attributable Costs

Costs that can be directly associated with a specific asset or service, and which would not have been incurred if the asset or service had not been acquired or produced.

Financial Liability

An obligation to deliver cash or another financial asset to another entity.

Legally Enforceable Right

A right that is recognized by law and can be upheld in a court.