Which of the following is a disadvantage of international expansion?
A)An FI can lower its net regulatory burden and therefore increase its potential net profitability by finding countries that have reduced activity restrictions and reserve requirements.
B)An FI can generate additional returns from new product innovations if it can sell such services internationally rather than just domestically.
C)Monitoring and information collection cost often are higher in international markets.
D)International expansion allows an FI to search for cheaper and more available sources of funds.
E)International activities enhance the opportunities to diversify the risk of earnings flows.

Question

Quizplus · Accepted Answer

Monitoring and information collection cost often are higher in international markets. International expansion brings added complexities and risks, which require additional resources to manage effectively. This often includes higher costs for monitoring and information collection in foreign markets due to language barriers, cultural differences, and different regulatory requirements.

Which of the Following Is a Disadvantage of International Expansion