Which of the following statements regarding multidomestic and global competition is false?
A) In global competition, rivals vie for worldwide market leadership and the leading competitors compete head-to-head in the markets of many different countries.
B) In globally competitive industries, a company's competitive position in one country both affects and is affected by its position in other countries.
C) In multidomestic competition, there is greater cross-country variation in market conditions and the nature of the competitive contest among rivals than tends to be the case in globally competitive markets.
D) With multidomestic competition, the competitive contest is localized, with rivals battling for national market leadership; moreover, winning in one country market does not necessarily signal that a company has the ability to fare well in the markets of other countries.
E) In global competition, the size of a firm's worldwide competitive advantage (or disadvantage) equals the sum of the competitive advantages (or disadvantages) it has in each country market where it competes.

Question

Quizplus · Accepted Answer

The statement in option E is false. In global competition, the size of a firm's worldwide competitive advantage (or disadvantage) is not equal to the sum of the competitive advantages (or disadvantages) it has in each country market where it competes. This is because the different countries in which a firm competes may have different market conditions, competitive dynamics, and consumer preferences that affect a company's ability to build and sustain a competitive advantage. Thus, a firm may have a strong competitive advantage in one country but struggle to compete effectively in another, potentially leading to an overall disadvantage in the global marketplace.

Which of the Following Statements Regarding Multidomestic and Global Competition