When a Company Faces Relatively Weak Pressures for Local Responsiveness

question 17

Multiple Choice

When a company faces relatively weak pressures for local responsiveness and cost reductions, it should tend to use a:

• A) global strategy.
• B) multidomestic strategy.
• C) transnational strategy.
• D) differentiation strategy.
• E) home replication strategy.

Understand behavioral economics' insights into self-control issues and time inconsistency.

Grasp how perceptions of fairness and the endowment effect influence economic decisions.

Appreciate the experimental evidence supporting behavioral economics theories, including outcomes of games like the dictator game and the ultimatum game.

Recognize how behavioral economics views the impact of giving people options and its implications for decision-making.

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Definitions:

Ratification

When the majority agrees with the terms of a collective bargain; when a principal confirms a contract entered into by his agent.

Promoters

Individuals or organizations that undertake the founding and organization of a corporation by arranging for its financing, registration, and public offering.

Fiduciary Duty

A legal obligation of one party to act in the best interest of another. The obligated party is typically a trustee, financial advisor, or lawyer.

Competing Business

A company that operates in the same industry and market segment as another, offering similar products or services.