Question

A U.S. firm is considering doing business in a foreign country. What economic factor should the business consider regarding the country in which it will conduct its business? A) whether the country is part of a cartel B) any tariffs the country might impose C) the political climate of the country D) cultural differences between the two countries E) the infrastructure of the country

Answer 1

D (Political concerns may lead a group of nations to form a cartel, a group of firms or nations that agrees to act as a monopoly and not compete with each other, to generate a competitive advantage in world markets. The Organization of Petroleum Exporting Countries (OPEC), the most famous cartel, was founded in the 1960's to increase the price of petroleum throughout the world and to maintain high prices in order to enhance the economies of its member nations.)