Which of the following statements about the Internationalization Process is INCORRECT? A. A company should consider...
Which of the following statements about the Internationalization Process is INCORRECT?
A. A company should consider its mode of internationalization based on its risk-taking capabilities.
B. Export is typically more complex and risky than license.
C. A company could leapfrog in the internationalization process from license directly into full FDI
D. Foreign direct investment is not more risky than domestic direct investment.
Homework Answers
Option D is incorrect
FDI is more risky because firms have relatively better idea about the domestic market and the culture shaping the region. Legal environment, regional complexities and other risks like interest rate risks, exchange rate risks are more challenging abroad than at home.
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