INTERNATIONAL BUSINESS CHAPTER 15&16

Why might a company produce goods in another country?

• A. To increase taxes

• To raise transportation costs

• To reduce production costs

• To avoid hiring local workers

What is one reason importing may not be enough for international success?

• It’s always more profitable

• It avoids foreign markets

• It may face trade restrictions

• It needs fewer employees

What does FDI stand for?

• Foreign Direct Investments

• Final Data Index

• Free Domestic Imports

• Foreign Development Initiative

What is a benefit of wholly owned FDI?

• Shared profits

• Less Market Control

• Freedom to pursue global strategies

• Fewer legal responsibilities

What is greenfield investment?

• Buying an existing foreign business

• Starting a new operation in a foreign country

• Renting office space abroad

• Selling goods to a foreign market

Why do companies form collaborative arrangements?

• To increase competition

• To share risks and knowledge

• To avoid foreign markets

• To lower product quality

What type of agreement involves one company giving another the right to use its brand and system?

• Licensing

• Franchising

• Turnkey

• Merger

What is a common reason for collaboration failure?

• Clear communication

• Cultural differences

• Equal goals

• Strong partnerships

What can help make a collaborative arrangement successful?

• Ignoring the partner's goals

• Clear roles and communication

• Conflicting interests

• Rushing decision

Which of the following is a type of collaborative arrangement?

• Licensing

• Outsourcing

• Exporting

• Direct mail