Chapter Questions
In a world of zero transportation costs, no trade barriers, and nontrivial differences between nations with regard to factor conditions, firms must expand internationally if they are to survive. Discuss.
Plot the position of the following firms on Figure 12.8: Procter \& Gamble, IBM, Apple, Coca-Cola, Dow Chemical, U.S. Steel, McDonald's. In each case, justify your answer.
In what kind of industries does a localization strategy make sense? When does a global standardization strategy make most sense?
Reread the Management Focus on Procter \& Gamble and then answer the following questions:a. What strategy was Procter \& Gamble pursuing when it first entered foreign markets in the period up until the $1980 s$ ?b. Why do you think this strategy became less viable in the 1990s?c. What strategy does $P \& G$ appear to be moving toward? What are the benefits of this strategy? What are the potential risks associated with it?
What do you see as the main organizational problems that are likely to be associated with implementation of a transnational strategy?