What Is Cultural Proximity

question 15

Multiple Choice

What is cultural proximity?

• A) The extent to which the host cultural ethos permits adoption of the parent company's organizational culture.
• B) Countries located on the same continent.
• C) Relative importance of individual differences among units of a multinational corporation.
• D) A short geographic distance between the host country of one subsidiary and the host country of another subsidiary.

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Definitions:

Market Equilibrium

A condition where the quantity of a good or service supplied equals the quantity demanded, leading to no upward or downward pressure on price.

Inefficient

A situation where resources are not used in the most effective way, leading to potential waste or lost opportunities.

Externalities

Costs or benefits of a market activity borne by a third party; externalities can be either positive or negative.

Pigovian Taxes

Taxes imposed on activities that generate negative externalities, aiming to correct market inefficiencies and reduce unwanted behaviors.