In which of the following circumstances is it not advantageous for a multinational competitor to concentrate its activities in a limited number of locations in order to build competitive advantage?
A) When the costs of performing certain value chain activities are significantly lower in certain geographic locations than in others
B) When a company has competitively superior patented technology that it can license to foreign partners
C) When there is a steep learning or experience curve associated with performing an activity in a single location
D) When certain locations have superior resources, allow better coordination of related activities, or offer other valuable advantages
E) When there are significant scale economies in performing the activity

Question

Quizplus · Accepted Answer

When a company has patented technology that it can license to foreign partners, it is advantageous to spread activities in multiple locations to maximize the exploitation of licensing opportunities. In this case, concentrating activities in a limited number of locations will limit its potential licensing opportunities and may lead to a loss of competitive advantage. In all the other circumstances listed, concentrating activities in a limited number of locations can lead to cost savings, coordination benefits, or scale economies that can enhance competitive advantage.

In Which of the Following Circumstances Is It Not Advantageous