Which of the following is most likely a true statement about companies' acquisition of resources/assets abroad?
A)Regardless of industry, cheap labor is the most sought after resource.
B)Resource availability limits a firm's production location choices.
C)Regardless of industry, raw materials are the most sought after resource.
D)Risks are higher for resource-seeking than for sales-seeking foreign operations.

Question

Quizplus · Accepted Answer

The availability of resources and assets in a particular location plays a significant role in a company's decision-making process while determining the production location. Companies may choose to set up operations in countries where resources are abundant and easily accessible, thereby reducing the cost of production. However, the availability of resources varies across different regions and may limit a company's location choices. Therefore, option B is the most likely true statement. Option A and C make blanket assumptions and are not applicable across industries. Option D is not necessarily true as risks depend on various factors, including the industry, political stability, and economic conditions of the countries in which the company is investing.

Which of the Following Is Most Likely a True Statement