Which of the following is NOT an advantage to exporting goods to reach international markets rather than entering into some form of FDI?
A)Fewer political risks.
B)Greater agency costs.
C)Lower front-end investment.
D)All of the above are advantages.

Question

Quizplus · Accepted Answer

Greater agency costs are not an advantage of exporting goods to reach international markets over FDI. Exporting still incurs agency costs such as transportation, insurance and other expenses related to managing the shipment of goods, but these may be lower than the costs of managing an overseas production facility. However, exporting does offer advantages such as fewer political risks and lower front-end investment.

Which of the Following Is NOT an Advantage to Exporting