Executives at a U.S. firm are debating whether to start a new operation in Russia or acquire an existing one. Which of the following factors best supports a decision to start up a new operation in Russia?
A) The Russian government places restrictions on the outward transfer of foreign capital.
B) Labor relations at existing Russian firms are poor and difficult to change.
C) Russia's currency is weak and stock market prices are significantly depressed.
D) Existing companies have goodwill and positive brand recognition in Russia.
Question 2
Improving explanatory power of the IO paradigm can be done by considering the potential for ________ to lead to a company's sustained competitive advantage.
A) bright, motivated managers
B) political trends and events
C) cultural institutions
D) new markets
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