Foreign operations are more likely to be set up as a foreign branch when ______.

Question

Quizplus · Accepted Answer

Setting up a foreign branch is more suitable when the earnings are expected to be negative in the early years of operations because the parent company can provide financial support to the branch until it becomes profitable. This is different from establishing a subsidiary, which would require the subsidiary to be financially independent and self-sustaining from the beginning.

Foreign Operations Are More Likely to Be Set Up as a Foreign