Final answer:
Global businesses with a functional structure tend to have a narrow product line, and this is generally true. The functional structure supports specialization and expertise in a specific area, which is beneficial for businesses with a core competency focus but may be less efficient for companies with a wide range of products. Therefore, the given statement is true.
Step-by-step explanation:
The statement that global businesses that use a functional structure usually have a narrow product line is generally true. A functional structure is a form of organizational design where a company is divided into departments that each take care of activities related to a specific functional area, such as marketing, production, or finance. This type of structure is often suited to companies that focus on a few products or services because it allows for a high level of specialization and expertise in their particular niche or core competency.
In contrast, companies with a wide range of products may find that a functional structure leads to inefficiencies because different product lines may require different strategies, processes, or customer service methods. These companies might benefit more from a divisional structure, where each division operates as its own semi-independent entity with its own resources tailored to the specific product line.
In the context of international trade, businesses with a functional structure may have less ability to utilize comparative advantage or economies of scale across a diverse product range. Instead, they tend to excel when they can concentrate resources on enhancing the quality and production efficiency of their core competency.