DigiSystems Inc

question 71

Multiple Choice

DigiSystems Inc. manufactures personal gauges for measuring contact with potentially hazardous materials. Its management wants to expand into international markets while also limiting the risks involved. Additionally, DigiSystems has a limited capital base for new or expanded facilities. Which of the following options for entering international markets should DigiSystems use?

• A)direct investment
• B)agent manufacturing
• C)joint venture
• D)licensing

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Definitions:

Total Revenue

The entire amount of income generated by the sale of goods or services by a company before any expenses are deducted.

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.

Variable Costs

Costs that change in proportion to the level of goods or services that a business produces.

Profit

The financial gain realized when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes involved in sustaining the activity.