Why Do Companies Decide to Enter a Market

question 81

Multiple Choice

Why do companies decide to enter a market?

• A) To capture economies of scale in product development,manufacturing,or marketing.
• B) To raise input costs through greater pooled purchasing power.
• C) To increase the rate at which they disperse experience and move up the learning curve.
• D) To concentrate risk within a broader base of countries,especially when sales are down in one area and the company can undermine sales elsewhere.
• E) To exploit the natural resources found within its home market.

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Definitions:

Marginal Tax

The additional tax paid on an additional dollar of income, used in progressive tax systems to tax higher incomes at higher rates.

Proportional

A relationship or ratio between two quantities where they change at the same rate.

Tax Rate

The proportion of income that a person or business must pay in taxes.

Digressive

Characteristics of a process or system that decreases in intensity or rate as it progresses.