Dunning's Theory Helps Explain

question 79

Multiple Choice

Dunning's theory helps explain

• A)how firms try to match each other's moves in different markets to try to hold each other in check.
• B)the interdependence between firms in an oligopoly that leads to imitative behavior among the rivals.
• C)why a greenfield investment in a new facility is better than an acquisition of or a merger with an existing local firm.
• D)the problems associated with doing business in a different culture where the rules of the game may be very different.
• E)how location factors affect the direction of FDI.

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Definitions:

Purposeful Behavior

Actions taken with specific goals in mind, often reflecting rational decision-making processes.

Costs and Benefits

An analysis or evaluation framework, often used in economics and business, that compares the advantages and disadvantages or gains and costs of a certain action.

Decision Making

The cognitive process of selecting a course of action from among multiple alternatives.

Macroeconomics

The part of economics concerned with the performance and behavior of the economy as a whole. Focuses on economic growth, the business cycle, interest rates, inflation, and the behavior of major economic aggregates such as the household, business, and government sectors.