If a Firm Is Trying to Enter a Market Where

question 93

Multiple Choice

If a firm is trying to enter a market where there are already well-established companies, and where global competitors are also interested in establishing a presence, the firm should choose a(n) _____.

• A) franchise
• B) greenfield investment
• C) joint venture
• D) acquisition

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Definitions:

Disposable Income

Net resources for spending and saving available to households after subtracting income taxes.

MPC

MPC, or Marginal Propensity to Consume, is the proportion of additional income that an individual spends on consumption.

APC

Average Propensity to Consume, the fraction of income that households spend on consumption as opposed to saving.

MPS

An acronym that can stand for multiple financial and economic terms, such as Marginal Propensity to Save, which indicates the fraction of additional income that a household saves.