As a firm expands into overseas markets, information problems and the complexity of operating within many varied cultures and economies may result in
A)constant returns to scale
B)diminishing marginal returns
C)declining long-run marginal cost
D)diseconomies of scale
E)economies of scale

Question

Quizplus · Accepted Answer

As a firm expands into overseas markets, it may face information problems and complexity related to operating within many varied cultures and economies. This can lead to diseconomies of scale, where the cost of production increases as the firm expands its operations. This can be due to factors such as increased complexity in coordinating activities across different markets, difficulties in adapting to local preferences and regulations, and higher costs of communication and transportation.

As a Firm Expands into Overseas Markets, Information Problems and the Complexity