Question

What factors cause some firms to become more internationalized than others?

Answer 1

firms may avoid opportunities because they lack knowledge about foreignmarkets or expect that the risks are excessive.Thus, the size of these firms is not affected bythe opportunities.c. Explain why MNCs such as Coca Cola and PepsiCo, Inc., still have numerousopportunities for international expansion.ANSWER: Coca Cola and PepsiCo still have new international opportunities becausecountries are at various stages of development.

Some countries have just recently openedtheir borders to MNCs.Many of these countries do not offer sufficient food or drinkproducts to their consumers.5. International Opportunities Due to the Internet.a.What factors cause some firms to become more internationalized than others?ANSWER: Theoperating characteristics of the firm (what it produces or sells) andthe riskperception of international business will influence the degree to which a firm becomesinternationalized.Several other factors such as access to capital could also be relevant here.Firms that are labor-intensive could more easily capitalize on low-wage countries while firmsthat rely on technological advances could not.b.Offer your opinion on why the Internet may result in more international business.ANSWER: The Internet allows foreasy and low-cost communication between countries, sothat firms could now develop contacts with potential customers overseas by having a website.Many firms use their website to identify the products that they sell, along with the prices foreach product.This allows them toeasily advertise their products to potential importersanywhere in the world without mailing brochures to various countries.In addition, they canadd to their product line and change prices by simply revising their website, so importers arekept abreast of the exporter’s product information by monitoring the exporter’s websiteperiodically.Firms can also use their websites to accept orders online.Somefirms with aninternational reputation use their brand name to advertise products over the interne

Answer 2

The operating components of the firm whatever the organization produces or sell and the prospect knowledge of international trade will determine the degree to which a firm becomes internationalized. Various other circumstances such as the access to capital could also be applicable here. Firms that are labor-intensive could more efficiently profit low-wage countries while firms that rely on technological advances are more internationalized.