It is more costly to do business in relatively primitive or undevelope

QUESTION

It is more costly to do business in relatively primitive or undeveloped economies because of the lack of infrastructure and supporting businesses.

Indicate whether the statement is true or false.

ANSWER

TRUE
It may be more costly to do business in relatively primitive or undeveloped economies because of the lack of infrastructure and supporting businesses. At the extreme, an international firm may have to provide its own infrastructure and supporting business, which obviously raises costs.