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FORco, a foreign corporation, decides to open a sales office in the United States. FORco has a...

Question:

FORco, a foreign corporation, decides to open a sales office in the United States. FORco has a choice of operating in the United States as:

a. a branch only.

b. a domestic corporation only.

c. either a branch in the United States or a domestic corporation.

d. neither a branch in the United States nor a domestic corporation.

Corporations Entering Foreign Countries:

Due to globalization, we hear more and more about companies expanding beyond their home borders. However foreign corporations are entering countries with differing legal systems, and this implies that varying tax, contracts, patents, and financial reporting laws apply, among others. Thus, the decision to enter a foreign country must be made carefully.

Answer and Explanation: 1

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The correct answer is c. either a branch in the United States or a domestic corporation, as detailed below:

When a foreign company decides to...

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Internationalization & Globalization of Businesses

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Chapter 16 / Lesson 3
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To increase opportunities for expansion, many businesses participate in the international market. Explore the internationalization and globalization of businesses and explore various methods companies use to do operate in the world markets.


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