Research suggests that emerging economy firms pay a higher premium than other firms when making cross-border acquisitions (Chapter 7 Strategic Focus).

Question

Quizplus · Accepted Answer

Research has indeed suggested that emerging economy firms pay a higher premium than other firms when making cross-border acquisitions. This is because they may face more uncertainties and risks, such as political instability, lack of information and experience in the foreign market, and cultural differences. As a result, they may have to offer a higher price to secure the deal and compensate for these factors.

Research Suggests That Emerging Economy Firms Pay a Higher Premium