For an MNE to exist,first foreign countries must provide location-specific advantages to attract the company to invest there,second the company must have ownership-specific advantages that counteract its liability of foreignness,third the company must have the organizational capability to leverage its strategic advantages more effectively internally than externally.

Question

Quizplus · Accepted Answer

This statement correctly describes the three conditions that must exist for a Multinational Enterprise (MNE) to emerge. The location-specific advantages could include factors like lower labor costs, access to natural resources, or favorable tax policies, among others. The ownership-specific advantages may refer to the firm's technological expertise, brand reputation, or unique business model, which make it more competitive than local firms. Finally, the organizational capabilities could involve the ability to manage global operations, coordinate cross-border teams, or transfer knowledge across different markets, which enables the MNE to capture synergies and create value.

For an MNE to Exist,first Foreign Countries Must Provide Location-Specific