Gizmo's marketing director argues that because the global economy is interconnected, if Gizmo continues to be profitable in the United States it should be able to invest that money to do well internationally

Question

Which of the following, if true, most weakens her argument?
A) Gizmo's existing products can be used in other countries.
B) The currency exchange rate between countries can fluctuate.
C) Current Gizmo employees will need special cultural training to do business effectively in other countries.
D) Investors will not be willing to put money into Gizmo's foreign business expansion without a detailed business plan.
E) Marketing strategies that are successful in the United States are not always successful overseas.

Answer 1

Answer: B
Explanation: B) The marketing director is neglecting the fact that the currency exchange rate between countries fluctuates. This means that if the U.S. dollar becomes weak against the local currency, finances in U.S. currency will not go as far in that country. Choice A strengthens the marketing director's argument because Gizmo could set up the same production methods overseas as it uses in the United States. Choices C, D, and E are incorrect because Gizmo could implement special cultural training, develop a detailed business plan, and plan specialized marketing strategies, respectively, and still parlay its domestic financial success to international success.