When it comes to FDI,Granular Holdings,Inc.makes greenfield investments in various foreign countries and fully manages all foreign operations on its own.Granular Holdings' FDI approach is risky because of the problems associated with
A)sharing a valuable technological know-how with a potential competitor.
B)an increase in transportation costs,especially for those products that have a low value-to-weight ratio.
C)doing business in a different culture where the rules of the game may be very different.
D)the possibility of an increase in trade barriers such as import tariffs or quotas.
E)increased production costs.

Question

Quizplus · Accepted Answer

Granular Holdings' FDI approach involves fully managing all foreign operations on its own, which can pose challenges when operating in a different culture with different rules of the game. This can lead to cultural misunderstandings and difficulties in navigating local rules and regulations, making it a risky approach to FDI. The other options (A, B, D, E) do not directly relate to the risks associated with managing foreign operations independently in a different cultural and regulatory environment.

When It Comes to FDI,Granular Holdings,Inc