Chat with AIExam 6: Entering Foreign Markets
Discussion of strategies for MNEs focuses on growth and global expansion. Under what circumstances can downsizing and withdrawing from countries make sense? Why might some firms fail to withdraw or downsize?
(37) 
VerifiedThe quick answer is that firms that wish to maximize profitability may find that resources used in a given country or in a particular product can be used more profitably elsewhere (including domestic instead of a foreign country) or on a different product. With constant changes in politics, economies, and technologies, opportunities and threats may require changes in the magnitude and dispersion of the firm's operations.
Students will have various ideas as to why some firms may fail to downsize or withdraw but explanations would likely include entrenched management that feels no threat from stockholders and is more concerned about the status involved in extensive global operations or who are unwilling to admit that an error was made by going into a particular product or country.
In order to be successful in foreign markets, it is necessary for a firm to match its efforts in market entry and geographic diversification with its strategic goals.
(36) VerifiedTrue
Which of the following exemplify trade barriers?
(33) VerifiedD
"Location, location, location" is an important factor in many strategic decisions. What considerations are essential in assessing location of potential foreign market entry?
(34) Country-of-origin affect consistently confers a positive perception of foreign firms and products.
(30) The strategic goal of __________ involves going after countries that offer the highest price.
(34) Selling the rights to intellectual property for a royalty fee happens with:
(39) The differences in formal and informal institutions that govern the rules of the game in different countries include _______ differences.
(40) Is it better to be a first mover or a late mover when entering foreign markets? Describe the advantages of either a first mover or late mover based on the example of an actual company.
(35) According to the textbook, what is most necessary to overcome the liability of foreignness?
(35) A location-specific advantage that a firm with efficiency-seeking strategy would be:
(32) The liability of foreignness is the inherent disadvantage foreign firms experience in host countries because of their nonnative status.
(39) Which of the following would NOT be considered an advantage of MNEs?
(34) The bargaining power of buyers may lead to forward vertical integration.
(27) 
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