Final answer:
Executives are drawn to new markets for business diversification, customer access, and potentially lower costs. International trade and agreements facilitate these goals by reducing barriers and encouraging foreign investment.
Step-by-step explanation:
The key reasons executives are enticed to enter new markets include diversification of business risk, access to new customers, and lowering costs. These motivations align with broader business strategies such as expanding consumer base, reaching economies of scale, and optimizing production and operation expenses. For example, diversification of business risk allows a company to spread its exposure across different markets, potentially mitigating losses if one market performs poorly. Access to new customers opens up new revenue streams and possibilities for market share growth. Lastly, entering new markets may offer ways to lower costs through more efficient supply chains, cheaper labor, or less stringent regulations.
International trade and foreign direct investments play a significant role in providing opportunities to businesses for achieving these goals. Moreover, multinational corporations often benefit from international agreements that reduce trade barriers and encourage cross-border economic activities, providing a conducive environment for businesses to enter new markets effectively.