Question 1

Wonder Cat Licensing (Scenario) 
Wonder Cat is a popular, new cartoon series created by the U.S-based All Cartoon Channel (ACC) . Currently, the only Wonder Cat item available for sale are shirts that are sold exclusively through the ACC Web site. The cartoon series is a big hit in China, and as a result ACC has been approached by a Chinese firm about a licensing agreement. ACC executives are considering the pros and cons of such an agreement before making any final decisions.
-Which of the following questions would be more important to evaluate before ACC enters a licensing agreement with the Chinese firm?

Accepted Answer

A)   What other cartoon characters in the U.S. have been licensed to Chinese firms?
B)   Should the Wonder Cat shirts that were available on the firm's Web site be removed from sale?
C)   Will the Wonder Cat products made by the Chinese firm be available for sale on the ACC Web site?
D)   How much control will ACC be able to maintain over the use of the Wonder Cat brand?

Question 2

Laws that govern contractual obligations are uniform across countries; therefore, it makes contract enforcement abroad easier for firms.

Accepted Answer

A) True 
 B)False

Question 3

Azoo Government Projects (Scenario) 
The nation of Azoo needs the assistance of a contractor to construct a new bridge and a subway system. The nation lacks the skilled labor and technical know-how to handle such large-scale projects. Representatives of the Azoo government are reviewing the project bids provided by two different international contractors. Contractor A proposes a turnkey contract for Azoo. Contractor B proposes a build-operate-transfer arrangement.
-The government of Azoo might select Contractor B in order to ________.

Accepted Answer

A)   prevent the builder from operating in the country for even a short period of time
B)   avoid rental fee, user fee, and tolls during the operational stage of the bridge and subway system
C)   build the projects cost-effectively
D)   increase the number of visitors to Azoo

Question 4

Cross-licensing often occurs in the semiconductor and chemical industries, and other intellectual property is acquired in reciprocal licensing arrangements between firms in order to ________.

Accepted Answer

A)   divide the costs of production and marketing between competing firms
B)   avoid research duplication and building on each other's innovations
C)   protect the inventions and designs of small firms from large MNEs
D)   decrease the likelihood of industrial spying and theft among firms

Question 5

Explain how licensing works as an entry strategy into foreign markets. Describe the risks faced by technological firms that enter licensing agreements in foreign countries.

Accepted Answer

A licensing agreement specifies the natu...

Question 6

A key challenge faced by the franchisee is the decreased likelihood of operating an independent business.

Accepted Answer

A) True 
 B)False

Question 7

Explain franchising as a foreign market entry strategy, and why franchising is a more comprehensive strategy than licensing.

Accepted Answer

Franchising is an advanced form of licen...

Question 8

In a master franchising agreement, the master franchisee has the right to subfranchise to other independent businesses and thus assume the role of the local franchisor.

Accepted Answer

A) True 
 B)False

Question 9

In a licensing agreement, the licensee provides ________.

Accepted Answer

A)   the rights to use its industrial design
B)   intellectual property, technical information, and assistance
C)   a combination of down-payment plus royalty payments
D)   the know-how and supporting products, such as raw materials and components

Question 10

Which of the following is an example of intellectual property?

Accepted Answer

A)   systems of measurement
B)   McDonald's golden arches
C)   an unpublished book
D)   a phone directory

Question 11

Under a build-operate-transfer (BOT) arrangement, a firm or consortium of firms contracts to build a major facility abroad and then transfers ownership to the project sponsor, typically the host-country government or public utility.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following is characteristic of cross-border contractual relationships?

Accepted Answer

A)   When compared to FDI, they are less susceptible to volatility and risk, and tend to bring both parties a predictable stream of revenue.
B)   The focal firm attains maximum control by establishing a physical presence, and ownership of key assets, in the foreign market.
C)   It attracts high attention and criticism for the focal firm because of the local perception of foreign entities.
D)   They are governed by a contract that provides the focal firm with no control over the foreign partner.

Question 13

Which of the following is NOT provided by the licensor?

Accepted Answer

A)   ongoing managerial guidance
B)   technical information and assistance
C)   an advisory role
D)   trademark

Question 14

________ is the world's leading licensing firm, with $56.6 billion in revenues.

Accepted Answer

A)   Nickelodeon
B)   The Walt Disney Company
C)   Mattel
D)   Major League Baseball

Question 15

Before undertaking contractual entry strategies abroad, management ________.

Accepted Answer

A)   should bribe government officials to ensure protection of intellectual property
B)   should register patents and copyrights with local governments
C)   should keep information about intellectual property confidential from all franchisees in countries with weak anti-piracy laws
D)   understand and follow subjective moral and ethical standards across markets

Question 16

A know-how agreement is one in which the focal firm provides technological or management knowledge about how to design, manufacture, or deliver a product or a service.

Accepted Answer

A) True 
 B)False

Question 17

Describe the guidelines for protecting intellectual property.

Accepted Answer

In advanced economies, intellectual prop...

Question 18

Which of the following makes it difficult to completely duplicate a food franchise in every global market?

Accepted Answer

A)   different local ingredients
B)   differences in language
C)   low bargaining power
D)   need to invest substantial capital

Question 19

Big Boy Burgers (Scenario) 
Big Boy Burgers (BBB)  is an American fast food restaurant chain that has franchises around the world. Recently, BBB managers have been concerned about protecting the firm's intellectual property, which includes the recipes for its unique burger sauces and specialty burger buns. Although BBB has never experienced a theft of intellectual property, the firm's managers feel BBB should be more cautious. Managers are meeting with security and legal experts to discuss the options available to the firm that would protect BBB from future international problems.
-Which of the following questions would be more important for the experts to evaluate when determining how to ensure intellectual property protection for Big Boy Burgers?

Accepted Answer

A)   What should be the penalties for theft of the recipes for their unique burger sauces and specialty burger buns?
B)   Is BBB partnering with ethical franchisees that have no intention of becoming BBB competitors in the future?
C)   What are the commonly counterfeited goods in the market?
D)   How are BBB franchisees modifying recipes and menus to meet the needs and desires of customers in local markets?

Question 20

An industrial design is intended to ________.

Accepted Answer

A)   eliminate the possibility of the design being copied
B)   improve a product's aesthetics and usability as well as increase its production efficiency, performance, or marketability.
C)   protect firms from intellectual property theft
D)   protect information of commercial value

Exam 15: Licensing, Franchising, and Other Contractual Strategies

An industrial design is intended to ________.

Correct Answer
verified

Correct Answer
verified

Cross-licensing often occurs in the semiconductor and chemical industries, and other intellectual property is acquired in reciprocal licensing arrangements between firms in order to ________.

Correct Answer
verified

Which of the following is NOT provided by the licensor?

Correct Answer
verified

Explain franchising as a foreign market entry strategy, and why franchising is a more comprehensive strategy than licensing.

Correct Answer
verified
Franchising is an advanced form of licen...
View Answer

In a licensing agreement, the licensee provides ________.

Correct Answer
verified

A key challenge faced by the franchisee is the decreased likelihood of operating an independent business.

Correct Answer
verified

Correct Answer
verified

________ is the world's leading licensing firm, with $56.6 billion in revenues.

Correct Answer
verified

Laws that govern contractual obligations are uniform across countries; therefore, it makes contract enforcement abroad easier for firms.

Correct Answer
verified

Describe the guidelines for protecting intellectual property.

Correct Answer
verified
In advanced economies, intellectual prop...
View Answer

Correct Answer
verified

Explain how licensing works as an entry strategy into foreign markets. Describe the risks faced by technological firms that enter licensing agreements in foreign countries.

Correct Answer
verified
A licensing agreement specifies the natu...
View Answer

Which of the following is characteristic of cross-border contractual relationships?

Correct Answer
verified

A know-how agreement is one in which the focal firm provides technological or management knowledge about how to design, manufacture, or deliver a product or a service.

Correct Answer
verified

Before undertaking contractual entry strategies abroad, management ________.

Correct Answer
verified

Which of the following makes it difficult to completely duplicate a food franchise in every global market?

Correct Answer
verified

Which of the following is an example of intellectual property?

Correct Answer
verified

In a master franchising agreement, the master franchisee has the right to subfranchise to other independent businesses and thus assume the role of the local franchisor.

Correct Answer
verified

Under a build-operate-transfer (BOT) arrangement, a firm or consortium of firms contracts to build a major facility abroad and then transfers ownership to the project sponsor, typically the host-country government or public utility.

Correct Answer
verified

Exam 15: Licensing, Franchising, and Other Contractual Strategies

An industrial design is intended to ________.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Cross-licensing often occurs in the semiconductor and chemical industries, and other intellectual property is acquired in reciprocal licensing arrangements between firms in order to ________.

Correct AnswerverifiedShow Answer

Which of the following is NOT provided by the licensor?

Correct AnswerverifiedShow Answer

Explain franchising as a foreign market entry strategy, and why franchising is a more comprehensive strategy than licensing.

Correct AnswerverifiedFranchising is an advanced form of licen...View AnswerShow Answer

In a licensing agreement, the licensee provides ________.

Correct AnswerverifiedShow Answer

A key challenge faced by the franchisee is the decreased likelihood of operating an independent business.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

________ is the world's leading licensing firm, with $56.6 billion in revenues.

Correct AnswerverifiedShow Answer

Laws that govern contractual obligations are uniform across countries; therefore, it makes contract enforcement abroad easier for firms.

Correct AnswerverifiedShow Answer

Describe the guidelines for protecting intellectual property.

Correct AnswerverifiedIn advanced economies, intellectual prop...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Explain how licensing works as an entry strategy into foreign markets. Describe the risks faced by technological firms that enter licensing agreements in foreign countries.

Correct AnswerverifiedA licensing agreement specifies the natu...View AnswerShow Answer

Which of the following is characteristic of cross-border contractual relationships?

Correct AnswerverifiedShow Answer

A know-how agreement is one in which the focal firm provides technological or management knowledge about how to design, manufacture, or deliver a product or a service.

Correct AnswerverifiedShow Answer

Before undertaking contractual entry strategies abroad, management ________.

Correct AnswerverifiedShow Answer

Which of the following makes it difficult to completely duplicate a food franchise in every global market?

Correct AnswerverifiedShow Answer

Which of the following is an example of intellectual property?

Correct AnswerverifiedShow Answer

In a master franchising agreement, the master franchisee has the right to subfranchise to other independent businesses and thus assume the role of the local franchisor.

Correct AnswerverifiedShow Answer

Under a build-operate-transfer (BOT) arrangement, a firm or consortium of firms contracts to build a major facility abroad and then transfers ownership to the project sponsor, typically the host-country government or public utility.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Franchising is an advanced form of licen...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
In advanced economies, intellectual prop...
View Answer

Correct Answer
verified

Correct Answer
verified
A licensing agreement specifies the natu...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified