_______________ Costs Arise When the Business System in a Foreign

question 117

Multiple Choice

_______________ costs arise when the business system in a foreign country is so different from that in a firm's home market that the enterprise has to devote considerable effort,time,and expanse to learning the rules of the game.

• A) Pioneering
• B) Early entry
• C) Introductory costs
• D) Inaugural costs
• E) Primary entrant

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Definitions:

Institutional Arrangements

The set of policies, norms, and regulations that shape the behavior of individuals and organizations within a society.

Economizing Problem

The choices necessitated because society’s economic wants for goods and services are unlimited but the resources available to satisfy these wants are limited (scarce).

Property Rights

Legal rights to possess, use, and dispose of assets including real estate, personal property, or intellectual property.

Mutually Agreeable Transactions

Exchanges between parties that both participants consider beneficial or satisfactory.