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An increase in the value of the U.S. dollar is an example of an economic risk in that it can reduce the value of U.S. multinational firms’ international assets and earnings in other countries

Firms are more likely to enter a market through acquisition when high product loyalty is present in the industry

Part of the attractiveness of cross-border alliances is that the full range of entry modes is available in virtually all countries in which firms seek to geographically diversify

In the final analysis, firms use merger and acquisition strategies to improve their ability to create value for all stakeholders, including stockholders

The term “conglomerates” refers to firms using the __________ diversification strategy.

Location advantages are influenced by costs of production, access to natural resources and critical supplies, as well as the needs of customers, but not culture

The stabilization of returns through international diversification helps reduce a firm’s overall risk

Evidence suggests that acquisitions usually lead to favorable financial outcomes, especially for the acquiring firm

Which of the following is NOT a disadvantage of international acquisitions?

A merger is a strategy through which two firms agree to integrate their operations on a relatively coequal basis