Using Domestic Plants as a Production Base for Exporting Goods

question 66

Multiple Choice

Using domestic plants as a production base for exporting goods to selected foreign country markets

• A)can be an excellent initial strategy to pursue international sales.
• B)can be a competitively successful strategy when a company is focusing on vacant market niches in each foreign country.
• C)works well when a firm does not have the financial resources to employ cross-market subsidization.
• D)is usually a weak strategy when competitors are pursuing multicountry strategies.
• E)can be a powerful strategy because the company is not vulnerable to fluctuating exchange rates.

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Definitions:

Sales Forecast

An estimate of the amount of sales a business expects to achieve in a certain period, based on historical data, market analysis, or other methods.

Direct Material B

Specified materials that are directly traceable to the manufacturing of a product and constitute a significant portion of production cost.

Finished Goods Inventory

Manufactured products that are complete and ready for sale, recorded as an asset on the balance sheet until sold.

Raw Materials Inventory

The total cost of all the components and materials held by a company that are eventually used in the production process.