Which of the Following Is a Disadvantage of Small-Scale Entry

question 73

Multiple Choice

Which of the following is a disadvantage of small-scale entry for an international firm considering foreign expansion?

• A)The possibility of escalating commitment leading to major financial losses
• B)The limited availability of resources for use in other markets
• C)The lack of flexibility associated with strategic commitments
• D)The increase in economic exposure due to minimal time spent in evaluating a foreign market
• E)The difficulty of building market share and capturing first-mover advantages

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Definitions:

Ration Coupons

Documents or certificates that allow the holder to purchase a certain amount of a product, used especially during shortages to ensure fair distribution.

Government-mandated Increase

A requirement imposed by the government that results in a rise, often relating to wages, prices, or taxes.

Demand and Supply Curves

Graphs used in economics to illustrate the relationship between how much of a good or service is desired by buyers (demand) and how much is available from suppliers (supply) at various prices.

Product Market

A market in which products are sold by firms and bought by households.