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Which of the following modes of foreign market entry offers the most control and the highest potential return for a company?

A.Exporting
B.Joint venture
C.Contractual agreement
D.Strategic alliance
E.Direct foreign investmemt

1 Answer

6 votes

Final answer:

Direct foreign investment offers the most control and the highest potential return for a company.

Step-by-step explanation:

Among the given options, direct foreign investment offers the most control and the highest potential return for a company. Direct foreign investment refers to establishing a physical presence in a foreign market by setting up operations, such as manufacturing facilities or subsidiaries.

When a company directly invests in a foreign market, it has full control over its operations, strategies, and decision-making processes. This allows the company to tailor its offerings and business approach according to the specific needs and preferences of the target market, leading to higher potential returns.

For example, a multinational company that invests in building manufacturing facilities in a foreign market can have complete control over production processes, quality standards, and distribution channels. This level of control enables the company to capture a larger share of the market and reap higher profits.

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