When Firms Expand into Global Markets, They Are Faced with the Choice

question 18

Multiple Choice

When firms expand into global markets, they are faced with the choice of reducing costs and/or adapting to the local market. When high pressures exist to adapt locally, companies should choose a(n) __________ or __________ in order to compete in the global marketplace.

• A)global strategy; transnational strategy
• B)global strategy: multidomestic strategy
• C)international strategy; global strategy
• D)transnational strategy; multidomestic strategy

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Definitions:

Pairs

Two things considered together because of similarity, opposition, or adjacency; often used in context to describe complementary items or concepts.

Marginal Cost

The outlay for creating another unit of a product or service.

Economies of Scale

Cost advantages that enterprises obtain due to their scale of operation, with cost per unit of output generally decreasing with increasing scale.

Output

The total amount of goods or services produced by a company, industry, or economy within a specific period.