Scenario: Blickinstock at the Crossroads
Auto parts supplier, Blickinstock Ltd., would like to expand its presence in Latin America. To that end, Blickinstock is trying to decide whether to purchase an existing company in a remote region of Argentina or build its own subsidiary. Keith Moon, Blickinstock's vice president of global business development, will be making a presentation to the board outlining the company's options.
-If board members ask about the maquiladora industry,Keith would explain that it refers to ________.
A) Mexico's low-cost labor union
B) the cross-border drug trafficking problem that threatens to limit legitimate production in Mexico
C) the low-wage, 130-mile-wide strip along the U.S.-Mexico border that comprises a special economic region
D) Latin America's new model for business that restricts foreign investors to take advantage of government incentives

Question

Quizplus · Accepted Answer

The maquiladora industry refers to the low-wage, 130-mile-wide strip along the U.S.-Mexico border that comprises a special economic region. This industry allows companies to import raw materials duty-free, assemble the final product with cheap labor, and then export the finished product back to the origin country with low tariffs. However, this option is not relevant to Blickinstock's decision to expand its presence in Latin America because it pertains to a specific region in Mexico rather than Argentina.