Answer (D) is correct . Reasons for international business expansion, known as direct foreign investment, can be both revenue-oriented (seeking new markets or avoiding trade restrictions) and cost-oriented (seeking cheaper inputs or favorable exchange rates). An attempt to protect the firm’s domestic market from foreign competition by expanding operations into foreign countries is unlikely.
Answer (A) is incorrect because Securing new sources of raw materials is one of the sound cost-related reasons firms have for international business expansion.
Answer (B) is incorrect because Seeking new markets is one of the sound revenue-related reasons firms have for international business expansion.
Answer (C) is incorrect because Attempting to minimize the costs of production is one of the sound cost-related reasons firms have for international business expansion.
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