GENERAL KNOWLEDGE

GK

MARKETING MANAGEMENT

Question [CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
A firm should open a fully owned foreign subsidiary when
A
The host country encourages FDI
B
Firm is looking for short term profits
C
Firm has just started selling in the host country
D
Firm wants to take full control over production and promotion in the target market
Explanation: 

Detailed explanation-1: -Acquiring a wholly-owned subsidiary can be a relatively cost-efficient way for a company to expand its product line or its geographic reach. It may acquire a competitor, thus expanding its own market share, or invest in a part of its own supply chain, making its production process more efficient.

Detailed explanation-2: -5. Wholly-owned subsidiary through greenfield venture. This entry mode means the firm owns 100% of the overseas entity, and your company will enter the new international market by establishing a completely new operation and legal entity.

Detailed explanation-3: -To keep full control over their venture, this method of international business is incorporated by organizations. The parent organization makes 100% investment in its equity capital and in this way takes full control over the foreign organization.

Detailed explanation-4: -Review your company. Take a careful look at your business to make sure you’re ready to expand internationally. Develop a market entry strategy. The next step is to develop a market entry strategy. Prepare and execute an export marketing plan.

There is 1 question to complete.