In the Context of Companies Entering Foreign Markets, Which of the Following

question 54

Multiple Choice

In the context of companies entering foreign markets, which of the following statements is true of the liability of foreignness?

• A) Companies doing business in countries that are geographically proximate face a small liability of foreignness.
• B) Companies doing business in countries that are economically dissimilar face a small liability of foreignness.
• C) Companies doing business in countries that share a common cultural base face a large liability of foreignness.
• D) Companies doing business in countries that have few administrative differences face a large liability of foreignness.

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Definitions:

Shortage

A situation where the demand for a product exceeds its supply in a market.

Units

The fundamental quantities or measurements in which variables, goods, services, or products are expressed or quantified.

Price Floor

A legally imposed minimum price set above the equilibrium price, preventing the market price from falling below a certain level.

Demand Decreases

A situation where the quantity of a good or service that consumers are willing and able to purchase at a given price declines.