Firms Implementing the Multidomestic Strategy Often Attempt to Isolate Themselves

question 75

True/False

Firms implementing the multidomestic strategy often attempt to isolate themselves from global competitive forces by establishing protected market positions or by competing in industry segments that are most affected by differences among local countries.

---

Definitions:

Riskiest Divisions

Business units or segments within a company that are subject to the highest levels of uncertainty and potential loss.

Positive NPV

A situation in which the net present value (NPV) of a project or investment is greater than zero, indicating that the projected earnings exceed the anticipated costs in present-value terms.

Cost of Capital

The rate of return that a business must earn on its investment projects to maintain its market value and attract funds.

Net Present Value

A calculation used to determine the present value of an investment's profit by discounting future cash flows back to their present value.