The Advantages of Using an Export Strategy to Build a Customer

question 50

Multiple Choice

The advantages of using an export strategy to build a customer base in foreign markets include

• A) being able to minimize shipping costs, avoid tariffs, and curb the effects of fluctuating exchange rates.
• B) minimizing risk and capital requirements.
• C) being cheaper and more cost effective than licensing and franchising.
• D) being cheaper and more cost effective than a multicountry strategy.
• E) being more suited to accommodating local buyer tastes and host government regulations than a global strategy.

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Definitions:

Shut Down Point

The point at which a company's revenue is exactly equal to its variable costs and it ceases operations to minimize losses.

Firm

A business organization, such as a corporation, partnership, or sole proprietorship, that sells goods or services in exchange for money.

Price

The sum of money anticipated, needed, or provided as compensation for something.

Price of Rice

The cost at which rice is sold, influenced by factors such as supply, demand, quality, and market conditions.