The liability of foreignness is:
A)The inherent disadvantage foreign firms experience in host countries.
B)Related strictly to the formal institutions that govern the way business is done in a foreign country.
C) A challenge when it comes to resource supply but not to competitive advantage.
D) Irrelevant in the process of entering foreign markets.

Question

The liability of foreignness is:
A)​The inherent disadvantage foreign firms experience in host countries.
B)​Related strictly to the formal institutions that govern the way business is done in a foreign country.
C) ​A challenge when it comes to resource supply but not to competitive advantage.
D) ​Irrelevant in the process of entering foreign markets.

Quizplus · Accepted Answer

The liability of foreignness refers to the inherent disadvantage that foreign firms experience in host countries, such as cultural barriers, lack of local knowledge, and regulatory differences. It is a challenge that foreign firms face when entering foreign markets and can hinder their ability to compete with local firms.

The Liability of Foreignness Is