Single Answer MCQ
Q-00045516
Why do MNCs prefer to acquire local firms instead of starting new ones?
1
Lower quality standards
2
Existing market networks
3
Government deregulation
4
Reduced competition
Answer and Solution
Answer
B. Existing market networks
Solution:
MNCs prefer acquiring local firms because these companies already have established market networks and customer bases, minimizing the risk and cost associated with creating a new enterprise. Other options do not address the incentive of immediate market access.
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