With cost venture into international markets to

With the expansion of business boundaries, it is imperative for companies to expand their operations globally. Most companies invest in international markets to reduce the operations costs and to leverage global distribution which enhances the companies to expand their market share. Companies that have overhead cost venture into international markets to take advantage of countries that have a low cost of living and deflated currencies. For instance, most firms in the US invest in foreign markets of countries that have a free trade arrangement with the US. Thus, their cost of operation is relatively lower, especially if there is a reduced cost of labor in the foreign country (Bekaert & Hodrick, 2017). However, global expansion depends on the foundation laid by the firm in its host country. Before venturing into the international market, the company must have established brand loyalty and understand all the risks associated with foreign financial market and how it operates. Depending on the country of origin, some firms prefer joining companies within specific trade unions such as the EU among others. The EU is a body that has a cohesive economy, official currency, political system, and operates in over twenty-eight countries. This paper focuses on analyzes the impact of global expansion and the benefits of operating with a company within and outside the EU. The paper also discusses the motive for multinational corporations to invest in foreign markets and why creditor also prefers crediting financial markets from other countries.


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