9. The least risky method by which firms conduct international business is: a franchising b. acquisitions of existing operations. c. international trade. d. the establishment of new subsidiaries. e. licensing

Question

June Reynolds

Business

17 April, 22:41

9. The least risky method by which firms conduct international business is: a franchising b. acquisitions of existing operations. c. international trade. d. the establishment of new subsidiaries. e. licensing

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Answers (1)

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Kendal Garrett · Answer 1

c. international trade

Explanation:

Options A and E are wrong because franchising and licensing businesses need to pay a special commission or extra expense to do the business. In that case, if the first company faces any disreputed problem due to the food, it is challenging for other franchisees to operate. Licensing business needs a massive cost at the start of the market.

Options B and D are wrong because acquisitions of existing operations or establishing a new subsidiary require high investment.

Option C is correct because international trade can take place at any time. There is a little cost when the trading period starts. Otherwise, there are not many costs. So, it is a less risky method.