Explain briefly how economies of scale and scope can be developed in production, marketing, finance, research and development, transportation, and purchasing.
Answer to relevant QuestionsA strongly competitive home market can sharpen a firm’s competitive advantage relative to firms located in less competitive markets. Explain what is meant by the “competitive advantage of nations.” How is foreign exchange risk sensitivity factored into the capital budgeting analysis of a foreign project? What if the rupiah should appreciate against the dollar? In the context of evaluating foreign investment proposals, how should a multinational firm evaluate cash flows in the host foreign country that are blocked from being repatriated to the firm’s home country? Is any accounting exposure created during the course of a firm’s operating cycle? The operating cash cycle of a multinational firm goes from cash collection from customers, cash holding for anticipated transaction needs (the transaction motive for holding cash), possible cash repositioning into another ...
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