21-135 Which of the Following Items Is an Advantage of International

question 53

Multiple Choice

21-135 Which of the following items is an advantage of international expansion for an FI?

• A)An FI faces the political risk that a change in government may lead to the nationalization of fixed assets.
• B)A global FI must master the rules and regulations of each market in which it operates.
• C)The fixed costs of establishing overseas organizations may be very high in certain markets.
• D)International expansions allow an FI to maintain contact with and provide service to the needs of domestic multinational corporations.
• E)The absolute level of risk exposure in certain markets can be very high.

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Definitions:

Price

The payment in money foreseen, mandatory, or supplied in exchange for something.

Pure Monopolist

A market structure in which a single company has exclusive control over the supply of a product or service, with no close substitutes.

Monopoly Profit

The excess earnings that a monopolist can secure over and above the earnings that could be achieved in a competitive market, due to the control over market prices.

Purely Monopolistic

A market structure in which a single company exclusively owns, produces, and sells a specific product or service, facing no competition.