Question 1

Pooling alliances are driven by the logic of contributing dissimilar resources,while trading alliances are driven by similarity and integration.

Accepted Answer

A) True 
 B)False

Question 2

A disadvantage(s) of indirect exporting is:

Accepted Answer

A)  foreign business can be lost if exporter changes supply sources
B)  no expertise or large cash outlays are required
C)  the firm gains little experience from transactions
D)  foreign business can be lost if exporter changes supply sources and the firm gains little experience from transactions
E)  firms find it hard to set sales offices in foreign countries

Question 3

Exporting can extend a product's life cycle by exporting to currently unserved markets where the product will be at the introduction stage of the life cycle.

Accepted Answer

A) True 
 B)False

Question 4

According to the text,a company that wishes to own a foreign subsidiary outright may:

Accepted Answer

A)  make a greenfield investment.
B)  purchase its distributor.
C)  acquire part of a going concern.
D)  purchase a competitor exporter
E)  make a greenfield investment or purchase its distributor or even acquire part of a going concern.

Question 5

A disadvantage(s) of indirect exporting is/are that:

Accepted Answer

A)  firms gain little experience from the transaction
B)  commissions have to be paid to agents
C)  firms are dependent on the agents
D)  firms gain little experience from the transaction,commissions have to be paid to agents,and firms are dependent on the agents.
E)  firms find it hard to set sales offices in foreign countries

Question 6

Why have more companies,at home and abroad,begun to obtain licenses instead of making illegal copies?

Accepted Answer

Answers may vary,but might include facto...

Question 7

Licensing refers to a contractual agreement in which the licensor grants access to its patents,trade secrets,or technology for a fee paid by the licensee.

Accepted Answer

A) True 
 B)False

Question 8

Under what circumstances is a follower likely to succeed when entering into international markets?

Accepted Answer

Answers may vary,but might include facto...

Question 9

Partnerships between or among competitors,customers,or suppliers that may take one or more of various forms,both equity and nonequity,are known as:

Accepted Answer

A)  licenses.
B)  joint ventures.
C)  wholly owned subsidiaries.
D)  strategic alliances.
E)  management contracts.

Question 10

If a firm decides to become involved in overseas manufacturing, it has two options: (1) wholly owned subsidiary and (2) joint venture.

Accepted Answer

A) True 
 B)False

Question 11

Benefits of joint ventures may include:

Accepted Answer

A)  The ability to respond to strong nationalistic sentiment in the host nation.
B)  Access to expertise that the company lacks.
C)  Differing strategies and cultures of the partners.
D)  The ability to respond to strong nationalistic sentiment in the host nation,and access to expertise that the company lacks
E)  purchase of its distributor.

Question 12

A pioneering firm stands the best chance for long term success in market-share leadership and profitability when:

Accepted Answer

A)  there are high entry barriers for competitors.
B)  it has strong patent protection.
C)  there are substantial investment requirements.
D)  there are high entry barriers for competitors,and there is strong patent protection,and when there are substantial investment requirements.
E)  there are low entry barriers for competitors.

Question 13

According to the text,licensing agreements usually stipulate that a royalty of __________ be paid to the licensor.

Accepted Answer

A)  2 to 5 percent of profits
B)  2 to 5 percent of sales
C)  5 to 7 percent of profits
D)  5 to 7 percent of sales
E)  8 to 10 percent of sales

Question 14

What is contract manufacturing and what are the ways in which international firms employ contract manufacturing?

Accepted Answer

Answers may vary,but might include facto...

Question 15

Trading and pooling alliances are typically different in their goals,optimal structures,and managerial challenges.

Accepted Answer

A) True 
 B)False

Question 16

Some firms do not grant licenses to other firms because of the fear of having a strong competitor upon the expiration of the license.

Accepted Answer

A) True 
 B)False

Question 17

It is not possible for foreign investors to control a joint venture if the host country's law prevents foreign investors from having more than 49% percent ownership.

Accepted Answer

A) True 
 B)False

Question 18

One type of strategic alliance between competitors is an R&D partnership.

Accepted Answer

A) True 
 B)False

Question 19

A turnkey project includes all of the following except:

Accepted Answer

A)  plan design.
B)  technology supply.
C)  supply of raw material.
D)  personnel training.
E)  export commission agents.

Question 20

Hilton and Delta provide assistance to other international companies.That is an example of:

Accepted Answer

A)  joint venture.
B)  management contract.
C)  strategic alliance.
D)  contract manufacturing.
E)  licensing.

Exam 13: Entry Modes

According to the text,a company that wishes to own a foreign subsidiary outright may:

Correct AnswerverifiedShow Answer

A disadvantage(s) of indirect exporting is:

Correct AnswerverifiedShow Answer

A turnkey project includes all of the following except:

Correct AnswerverifiedShow Answer

According to the text,licensing agreements usually stipulate that a royalty of __________ be paid to the licensor.

Correct AnswerverifiedShow Answer

Some firms do not grant licenses to other firms because of the fear of having a strong competitor upon the expiration of the license.

Correct AnswerverifiedShow Answer

Why have more companies,at home and abroad,begun to obtain licenses instead of making illegal copies?

Correct AnswerverifiedAnswers may vary,but might include facto...View AnswerShow Answer

One type of strategic alliance between competitors is an R&D partnership.

Correct AnswerverifiedShow Answer

Partnerships between or among competitors,customers,or suppliers that may take one or more of various forms,both equity and nonequity,are known as:

Correct AnswerverifiedShow Answer

Benefits of joint ventures may include:

Correct AnswerverifiedShow Answer

If a firm decides to become involved in overseas manufacturing, it has two options: (1) wholly owned subsidiary and (2) joint venture.

Correct AnswerverifiedShow Answer

Hilton and Delta provide assistance to other international companies.That is an example of:

Correct AnswerverifiedShow Answer

Exporting can extend a product's life cycle by exporting to currently unserved markets where the product will be at the introduction stage of the life cycle.

Correct AnswerverifiedShow Answer

What is contract manufacturing and what are the ways in which international firms employ contract manufacturing?

Correct AnswerverifiedAnswers may vary,but might include facto...View AnswerShow Answer

Under what circumstances is a follower likely to succeed when entering into international markets?

Correct AnswerverifiedAnswers may vary,but might include facto...View AnswerShow Answer

A pioneering firm stands the best chance for long term success in market-share leadership and profitability when:

Correct AnswerverifiedShow Answer

It is not possible for foreign investors to control a joint venture if the host country's law prevents foreign investors from having more than 49% percent ownership.

Correct AnswerverifiedShow Answer

Pooling alliances are driven by the logic of contributing dissimilar resources,while trading alliances are driven by similarity and integration.

Correct AnswerverifiedShow Answer

Licensing refers to a contractual agreement in which the licensor grants access to its patents,trade secrets,or technology for a fee paid by the licensee.

Correct AnswerverifiedShow Answer

A disadvantage(s) of indirect exporting is/are that:

Correct AnswerverifiedShow Answer

Trading and pooling alliances are typically different in their goals,optimal structures,and managerial challenges.

Correct AnswerverifiedShow Answer

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Answers may vary,but might include facto...
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Answers may vary,but might include facto...
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