QUESTION An international firm that enters into a turnkey deal has a long-term interest in the foreign country. Indicate whether the statement is true or false. ANSWER FALSE An international firm that enters into a turnkey deal will have no long-term interest in the foreign country. This can be a disadvantage if that country […]
QUESTION Establishing a wholly owned subsidiary gives an international firm a 100 percent share in the profits generated in a foreign market Indicate whether the statement is true or false. ANSWER TRUE There are several clear advantages of wholly owned subsidiaries. Establishing a wholly owned subsidiary gives the firm a 100 percent share in […]
QUESTION A drawback of exporting is that tariff barriers can make it uneconomical as a mode of entry into a foreign market. Indicate whether the statement is true or false. ANSWER TRUE A drawback of exporting as a mode of entry into a foreign market is that tariff barriers can make it uneconomical. Similarly, […]
QUESTION If an international firm’s core competence is based on proprietary technology, entering a joint venture might risk losing control of that technology to the joint-venture partner. Indicate whether the statement is true or false. ANSWER TRUE If an international firm’s core competence is based on proprietary technology, entering a joint venture might risk […]
QUESTION Exporting, as a mode of entry into foreign markets, does not help a firm achieve experience curve and location economies. Indicate whether the statement is true or false. ANSWER FALSE Exporting may help a firm achieve experience curve and location economies. By manufacturing the product in a centralized location and exporting it to […]
QUESTION Firms pursuing global standardization or transnational strategies tend to prefer setting up wholly owned marketing subsidiaries. Indicate whether the statement is true or false. ANSWER TRUE Setting up wholly owned marketing subsidiaries is preferable to joint-venture arrangements and to using foreign marketing agents because it gives the firm tight control that might be […]
QUESTION According to Christopher Bartlett and Sumantra Ghoshal, firms from developing countries cannot succeed in foreign markets in the presence of other established global competitors Indicate whether the statement is true or false. ANSWER FALSE Christopher Bartlett and Sumantra Ghoshal have pointed out the ability that businesses based in developing nations have to enter […]
QUESTION An international firm that perceives its technological advantage to be transitory and susceptive to rapid imitation might want to license its technology to foreign firms Indicate whether the statement is true or false. ANSWER TRUE When a firm perceives its technological advantage to be only transitory or when it expects rapid imitation of […]
QUESTION Licensing, a mode of entry into a foreign market, gives an international firm tight control over manufacturing, marketing, and strategy that is required for realizing experience curve and location economies. Indicate whether the statement is true or false. ANSWER FALSE Licensing, a mode of entry into a foreign market, does not give a […]
QUESTION Under a cross-licensing agreement, a firm can either request a royalty payment or license some valuable intangible property to a foreign partner. Indicate whether the statement is true or false. ANSWER FALSE Under a cross-licensing agreement, a firm might license some valuable intangible property to a foreign partner, but in addition to a […]
