Which of the Following Approaches May Be Used by Multinational

question 2

Multiple Choice

Which of the following approaches may be used by multinational companies to deal with the problem of price escalation?

• A) Disintermediation
• B) Manufacture the product in the foreign country
• C) Backward innovation
• D) All of the above
• E) (a) and (b) only

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Definitions:

Markup Percentage

The proportion added to the purchase price of products to cover operational costs and profit, which sets the retail price.

Total Cost

The complete expenditure incurred by a business, combining both fixed and variable costs to produce goods or services.

Variable Cost

Costs that vary directly with the level of production or sales, such as materials and labor.

Rate of Return

The profit or deficit incurred on an investment during a certain period, shown as a percentage of the original investment amount.