Which of the Following Primarily Explains Why Developing Nations Are

question 37

Multiple Choice

Which of the following primarily explains why developing nations are characterized by lower percentage of cross-border mergers and acquisitions compared to developed nations?

• A) Fewer target firms to acquire in developing nations
• B) Fierce opposition to mergers and acquisitions in developed nations
• C) Unwillingness of foreign companies to invest in developing nations
• D) Presence of import quotas in developing nations

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Definitions:

Price

The amount of money expected, required, or given in payment for something. It serves as a signal between buyers and sellers in a market.

Labor

The human effort, both physical and mental, used in the production of goods and services.

Substitution Effect

The change in quantity demanded of a good or service as consumers switch to or from substitutes when the price changes.

Income Effect

The change in an individual's or economy's income and how that change will impact the quantity demanded of a good or service.