How Will a Business Firm Know If There Is a Demand

question 251

Multiple Choice

How will a business firm know if there is a demand for its product in another nation?

• A) The company is willing to discuss royalty fees with other international firms.
• B) There is a positive balance of payments.
• C) A firm cannot know if such a demand exists.
• D) The product is very successful in the company's home nation.
• E) Due to the successful prior entry of a competitor firm with a similar product in the international market.

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Definitions:

Notes Payable

Written agreements in which one party promises to pay another party a definite sum of money either on demand or at a specified future date.

Payment

The act of transferring money or other valuable items in exchange for goods, services, or to fulfill a legal obligation.

Effective Interest Method

A method of calculating the interest expense on a bond or loan that considers the impact of amortizing premium or discount over the life of the financial instrument.

Interest Expense

The cost incurred by an entity for borrowed funds, such as loans or bonds.