In deciding whether to invest abroad, management must first determine whether the firm has a sustainable competitive advantage that enables it to compete effectively in the home market. The competitive advantage must be:
A) firm specific.
B) not easily copied.
C) in a transferable form.
D) all of the above

Question

Quizplus · Accepted Answer

The best choice is D, as all of the options are necessary for a competitive advantage to be sustainable and successfully transferred to foreign markets. The advantage must be firm-specific, meaning it is unique to that particular company and difficult for competitors to imitate. It must also be not easily copied, as this would diminish the advantage and make it less sustainable. Finally, the advantage must be in a transferable form so that it can be successfully applied to foreign markets without losing its potency.

In Deciding Whether to Invest Abroad, Management Must First Determine