What activities can a business engage in to compete in foreign markets?

Engaging in investment and licensing agreements is a strategic approach that businesses can take to effectively compete in foreign markets. Investment allows businesses to establish a physical presence in a new country, which can lead to a better understanding of the local market and consumer behavior, as well as the ability to tailor products or services to meet local demand. By entering into licensing agreements with local firms, businesses can leverage established distribution channels and local knowledge, facilitating smoother entry into foreign markets.

The other activities listed, such as reducing production costs, hiring local workers, or using social media for advertising, while potentially beneficial, are less comprehensive as standalone strategies for competing in foreign markets. For instance, merely reducing production costs doesn't address the complexities of market entry and localization that foreign markets often require. Similarly, hiring local workers or using social media can be components of a broader strategy, but they do not provide the direct market access and collaboration benefits that investment and licensing agreements do.