Business, 06.03.2020 23:44 Serenitybella

A firm considers which strategy is optimal for its globalization initiatives.
It considers:
1) a Foreign Direct Investment (FDI), which has a present value of $6,000,000 and an initial cost of $4,000,000;
2) an exporting strategy, which has a present value of $3,500,000 and an initial cost of $500,000; and finally, 3) a Licensing strategy, which has a present value of $2,000,000 and no initial costs.
Required:
a. If the firm uses the Net Present Value (NPV) decision rule, which option should it choose?
O. Exporting
O. Licensing
O. None of the three options
O. FDI
O The firm should be indifferent between the three options, because they all have positive NPVs.

Answers: 3

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A firm considers which strategy is optimal for its globalization initiatives.
It considers:

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