Which of the Following Is True of a "Follow the Leader

question 67

Multiple Choice

Which of the following is true of a "follow the leader" scenario in the context of foreign direct investment?

• A) Companies that practice "follow the leader" supply each other with inputs.
• B) Companies that practice "follow the leader" pressurize each other to follow environmentally safe methods.
• C) It is a frequent practice in industries with a limited number of large firms.
• D) It is common in industries in which producers source component parts from suppliers.

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Definitions:

Flexible Exchange Rates

A foreign exchange system where exchange rates are determined by the supply and demand for currencies and can fluctuate freely.

Nation's Currency

The legal tender or monetary system that a country uses for its economic transactions.

Tastes

The perceived preferences or desires of consumers or individuals, often influencing their behavior and choices.

Exchange Rates

The value of one currency expressed in terms of another currency, used to determine how much of one currency you can exchange for another.