Then, in descending order, came wholesale trade, petroleum, real estate, and insurance. On the basis of this information, the conglomerate has decided to purchase a European firm. “The best...

Then, in descending order, came wholesale trade, petroleum, real estate, and insurance. On the basis of this information, the conglomerate has decided to purchase a European firm. “The best acquisitions in the United States have already been picked,” the president told the board of directors. “However, I’m convinced that there are highly profitable enterprises in Europe that are ripe for the taking. I’d particularly like to focus my attention on the UK and Germany.” The board gave the president its full support, and the research firm will begin focusing on potential European targets within the next 30 days.

1. Is Europe likely to be a good area for direct investment during the years ahead?

2. Why is so much foreign money being invested in U.S. manufacturing? Based on your conclusions, what advice would be in order for the conglomerate?

3. If the conglomerate currently does not do business in Europe, what types of problems is it likely to face?