Which of the Following Is a Disadvantage of Small-Scale Entry

question 22

Multiple Choice

Which of the following is a disadvantage of small-scale entry for an international firm considering foreign expansion?

• A)possibility of escalating commitment leading to major financial losses
• B)limited availability of resources for use in other markets
• C)lack of flexibility associated with strategic commitments
• D)increase in economic exposure due to minimal time spent in evaluating a foreign market
• E)difficulty of building market share and capturing first-mover advantages

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Definitions:

Fixed Factory Overhead Volume Variance

This calculates the difference between the budgeted and actual volume of production, affecting the fixed overhead costs allocated to each unit of production.

Variable Factory Overhead Controllable Variance

The difference between the actual variable overhead costs and the budgeted costs controllable by management.

Variances

Differences between planned and actual performance in budgeting or costing.

Standard Costs

Predetermined or estimated expenses that are often used to measure the performance of manufacturing departments or operations.