MekTech is a U.S.-based electronics company. It is planning to introduce a new home theatre system in a foreign country. It has identified Mexico and Canada to be the easiest foreign markets to enter; however, it only wants to launch the system in one country. Which of the following parameters should the company most likely consider to determine the growth potential of these foreign markets?
A) Purchasing power
B) Political uncertainty
C) Expropriation potential
D) Sociocultural differences

Question

Quizplus · Accepted Answer

The company should consider purchasing power as it is an important indicator of the potential sales revenue and profitability. It gives an idea of the average income of the population and their capability to afford the new home theatre system. Political uncertainty and expropriation potential are more relevant in assessing the risks of doing business in a foreign market rather than its growth potential, while sociocultural differences may affect the product's acceptance by the target market but do not necessarily indicate the market's growth potential.

MekTech Is a U