List at least five potential advantages to initiating, continuing, and/or expanding international operations.

 Student answers will vary but may include five of the following. 1) Firms can gain new customers for their products. 2) Foreign operations can absorb excess capacity, reduce unit costs, and spread economic risks over a wider number of markets. 3) Foreign operations can allow firms to establish low-cost production facilities in locations close to raw materials and/or cheap labor. 4) Competitors in foreign markets may not exist, or competition may be less intense than in domestic markets. 5) Foreign operations may result in reduced tariffs, lower taxes, and favorable political treatment. 6) Joint ventures can enable firms to learn the technology, culture, and business practices of other people and to make contacts with potential customers, suppliers, creditors, and distributors in foreign countries. 7) Economies of scale can be achieved from operating in global, rather than solely domestic, markets. Larger-scale production and better efficiencies allow higher sales volumes and lower-price offerings. 8) A firm's power and prestige in domestic markets may be significantly enhanced if the firm competes globally, which can translate into improved negotiating power with creditors, distributors, suppliers, etc.