Question

Which of the following is a drawback faced by multinational enterprises (MNEs)pursuing an international strategy?

a. They cannot leverage their home-based core competencies in foreign markets.
b. They are highly affected by exchange rate fluctuations.
c. They have to be highly responsive to local needs and preferences.
d. They cannot reap the benefits of economies of scale due to their highly customized products.

Answer 1

Option b. They are highly affected by exchange rate fluctuations.

Step-by-step explanation:

international strategy can be defined simply as the means or strategy by which a firm sells its goods and services outside its domestic market. they helps by enabling firms to leverage their home-based core competencies in foreign markets.

A multinational enterprise (MNE) can be said to be a company that deploys resources and capabilities in the procurement, production, and distribution of goods and services in at least two countries and it can only pursue international strategy if only when it enjoys a large domestic market, strong reputation, and brand name. exchange rate fluctuations affects MNE pursuit of international strategy.