Which of the following is true of exporting?
A) It avoids the often substantial costs of establishing manufacturing operations in the host country.
B) It is the best choice if lower-cost manufacturing locations are available abroad.
C) Low transportation costs may make exporting uneconomical.
D) Tariff barriers may make exporting the most attractive option.

Question

Quizplus · Accepted Answer

Exporting has two distinct advantages. First, it avoids the often substantial costs of establishing manufacturing operations in the host country. Second, exporting may help a firm achieve experience curve and location economies.
However, there are several disadvantages of exporting. First, exporting may not be appropriate if lower-cost manufacturing locations are available abroad. Second, high transportation costs may make exporting uneconomical. Finally, tariff barriers may make exporting less attractive.

Which of the Following Is True of Exporting