MedPlus Incorporated, based in the United States, hesitates to enter i

QUESTION

MedPlus Incorporated, based in the United States, hesitates to enter into a joint venture with Azpak Limited, a Sri Lankan company, due to inadequate protection of intellectual property rights. MedPlus is trying to avoid what type of risk?

A. Political

B. Legal

C. Ethical

D. Economic

E. Ethnographic

ANSWER

B
When legal risks in a country are high, an international business might hesitate entering into a long-term contract or joint-venture agreement with a firm in that country.