________ is an explanation of the process by which firms acquire and retain one or more value-chain activities inside the firm, minimizing the disadvantages of dealing with external partners and allowing for greater control over foreign operations.

Question

Quizplus · Accepted Answer

Internalization theory explains how firms can reduce transaction costs and better manage their operations by keeping activities within the firm, rather than relying on external partners or the market. This theory is particularly relevant in the context of international business, where firms may choose to internalize operations to have greater control over their foreign activities and to minimize the disadvantages of dealing with external entities.

________ Is an Explanation of the Process by Which Firms