Botsford,a U.S.firm,builds automotive transmissions in its manufacturing facility in Taiwan to capitalize on the availability of cheap labor.Botsford's involvement in foreign markets is most likely through ________.
A) joint ownership
B) direct investment
C) management contracting
D) contract manufacturing
E) indirect exporting

Question

Quizplus · Accepted Answer

The scenario describes a situation of direct investment, where Botsford has set up its own manufacturing facility in Taiwan to produce automotive transmissions. Joint ownership implies partnership with local firms, management contracting involves hiring a third-party to manage operations in a foreign market, contract manufacturing involves outsourcing production to a local firm, while indirect exporting involves selling goods through intermediaries. None of these scenarios fit the situation described in the scenario.