Which of the Following Is a Disadvantage of Exporting as a Mode

question 144

Multiple Choice

Which of the following is a disadvantage of exporting as a mode of entry into foreign markets?

• A) The exporting firm incurs the costs of establishing manufacturing operations in the host country.
• B) The firm is unable to realize curve economies through exporting.
• C) High transport costs can make exporting uneconomical, particularly for bulk products.
• D) The firm cannot use countertrading options when exporting.
• E) A firm may not realize substantial scale economies from its global sales volume via exporting.

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Definitions:

Partial Performance

Completion of only part of the obligations specified in a contract, which may affect the enforceability or terms of the contract.

Lost Profits

Financial gains that were expected but not realized due to the wrongful acts of another party.

Breach of Contract

The failure to fulfill the terms agreed upon in a contract, whether by not performing duties, providing defective goods, or any other non-compliance.

Contractor

An individual or firm that agrees to provide materials or perform services for another party under the terms of a contract.