MaltHanks Inc.,a leading American firm,starts its operations in China.It incurs a lot of additional costs in comparison to the local firms.These costs originate in limited local knowledge and local stakeholders' discriminatory attitudes.Which of the following best describes the problem faced by MaltHanks?
A) Foreign premium
B) Liability of foreignness
C) Liability of localization
D) International premium

Question

Quizplus · Accepted Answer

The problem faced by MaltHanks is best described as the "liability of foreignness," which refers to the additional costs and challenges that foreign firms encounter when operating in a new country due to lack of local knowledge and potential discrimination by local stakeholders.