Risk Is an Important Factor for Companies Engaged in International

question 25

Multiple Choice

Risk is an important factor for companies engaged in international business.One way a collaborative arrangement helps minimize risk when operating abroad is by ________.

• A)reducing the possibility of technological appropriation
• B)freeing up resources so a company can diversify into more countries
• C)preventing the entry of new competitors
• D)eliminating losses from exchange rate depreciation abroad

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Definitions:

Communist Theory

A social, political, and economic ideology that aims at the establishment of a classless society where the means of production are owned communally.

Private Property

Legal rights that allow individuals or entities to own, use, and dispose of assets.

Demand and Supply

Fundamental economic concepts that describe the amount of a product or service available for purchase (supply) and the desire of buyers for it (demand), influencing price and market equilibrium.

Market Failure

A situation where the allocation of goods and services by a free market is not efficient, often leading to a net social welfare loss.