Which of the Following Is Not True of the Stages

question 59

Multiple Choice

Which of the following is not true of the stages of international development?

• A) Corporations operating internationally tend to evolve through five common stages.
• B) Stage 1 of international development is the domestic company.
• C) In Stage 4 of international development, the company adds an international division with responsibility for most of the business functions conducted in other countries.
• D) In Stage 2 of international development, the firm is a domestic company with an export division.
• E) In Stage 5 of international development, all managers are responsible for dealing with international as well as domestic issues.

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Definitions:

M&M Proposition I

A theory stating, under certain conditions, that the value of a firm is unaffected by how it is financed, whether through debt or equity.

Interest Tax Shield

The reduction in income taxes that results from taking a deductible charge, such as interest on debt, reducing taxable income.

Tax

Compulsory financial charge or some other type of levy imposed upon a taxpayer by a governmental organization in order to fund government spending and various public expenditures.

Capital Structure

The mix of different forms of external funds and equity used by a firm to finance its overall operations and growth.