Which of the Following Is True About Dunning's Arguments

question 85

Multiple Choice

Which of the following is true about Dunning's arguments?

• A)Dunning rejects the argument of internalization theory that it is difficult for a firm to license its own unique capabilities and know-how.
• B)Dunning suggests that to exploit foreign resources,such as oil and other minerals,a firm must undertake licensing rather than FDI.
• C)Dunning argues that it makes sense for a firm to locate production facilities in those countries where the cost and skills of local labor is most suited to its particular production processes,since labor is not internationally mobile.
• D)Dunning's theory and its extensions help explain the imitative FDI behavior by firms in oligopolistic industries.
• E)Dunning argues that combining location-specific assets or resource endowments with the firm's own unique capabilities always requires licensing.

---

Definitions:

Proportional Rate Structure

A tax system where the tax rate is the same for all income levels, meaning everyone pays the same percentage of their income in taxes, regardless of how much they earn.

Legislative Regulations

are rules made by a government or regulatory body that have the force of law.

Progressive Rate Structure

A tax system where the tax rate increases as the taxable amount increases, resulting in those with higher incomes paying a higher rate of tax on their income.

Federal Income Tax

A tax levied by the U.S. government on the annual earnings of individuals, corporations, trusts, and other legal entities, based on their income levels.