B.It does not give a firm the tight control over strategy that is required for realizing experience curve and location economies. WebB. B. A. _____. country. C. It is a specialized form of licensing. Which of the following is the primary objective of this strategic alliance? B. Misrepresentation B. reduce the level of conflicts that occur within an organization. 50/50 B. C. Consumer durables, computer peripherals, and automotive parts They limit the entry of firms into foreign markets. Web1) Strategic alliances are commonly found in markets where there is a pure competition market structure. Strategic alliances can make entry into a foreign market difficult. B. A. A. B. A. C. A distribution agreement behave in an opportunistic manner toward each other. D. exporting; joint-venture, If a high-tech firm sets up operations in a foreign country to profit from a core competency in C. wholly owned subsidiary WebB. 60/40 D. In many cases, firms make acquisitions to preempt their competitors. while it has the Skip to document Ask an Expert Sign inRegister Sign inRegister Home Ask an ExpertNew B. C. low transaction costs When the development costs and/or risks of opening a foreign market are high, a firm might gain by sharing these costs and or risks with a local partner. The contributions made by individual firms are easy to measure. The editor has asked you to show her writers a software feature that will make their job easier. A. drive early entrants out of the market. of developing new products or processes. WebQuestion: Which of the following statements is true about strategic alliances? He partners with Loumang Inc., a fabric manufacturing company, to develop certain customized inputs. B. franchises Strategic alliances bring together complementary skills and assets from each partner. A. C . whether to enter on a significant scale. The alliance between the two firms is an example of _____. C. greenfield investments True False, The attractiveness of a country as a potential market for an international business depends on balancing the benefits, costs, and risks associated with doing business in that country. True False, First-mover advantages are the advantages associated with entering a market early. Which of the following statements strengthens Sanah's argument? B. C. a plant that is ready to operate. D. turnkey projects, Turnkey projects are most common in which of the following industries? A. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. C. Cooperation between the two firms is not likely to depend on cross-equity holdings. C. It helps a firm achieve experience curve and location economies. C. A coordination alliance D. Foreign franchises controlled by joint ventures, D. Foreign franchises controlled by joint ventures. A. D. Hold minority ownership in the venture so that the firm does not have to give over control of the Marcel, the CEO of an automobile company, considers extending his research and development facility by collaborating with a multinational company. optimal choice? The two firms are likely to seek a joint venture through the collaboration. D. Dispute clauses, Teal Inc., forms a strategic alliance with White Corp. By sharing only the technology that is central to the core competence of the firm. A firm is relieved of many of the costs and risks of opening a foreign market on its own. B. relational assets \end{array} A. turnkey project C. In strategic alliances, companies may choose to cooperate at any stage along the value chain. curve and location economies. In the first clause, they specify how decisions will be made, how profits will be split, and how disputes will be resolved. Timber Inc. enters an exclusive partnership to ally with Teal Corp. in order to enter a foreign market. C. It is required if a firm is trying to realize location and experience curve economies. D. licensing, _____ allow a firm to rapidly build its presence in the target foreign market. C. operational assets Which of the following is being exemplified in this case? How much direct labor should be debited to Work in Process? C. It avoids the often substantial costs of establishing manufacturing operations in the host country, When an exporting firm finds that its local agent is also carrying competitors' products, the firm may switch to a _____ to handle local marketing, sales, and service. D. Creating product differentiation, _____ occurs when one partner tries to exploit the alliance-specific investments made by another partner. True False, To maximize the learning benefits of an alliance, a firm must try to learn from its partner and then apply the knowledge within its own organization. Prepare a written outline of the points of your presentation. D. In many cases, firms make acquisitions to preempt their competitors. The choice of which markets to enter should be driven by an assessment of relative long-run growth and profit potential. D. tangible property. Under a(n) _____ agreement, a firm might license some valuable intangible property to a foreign Conflicts are avoided by regular interaction, and any dispute that arises is resolved at an early stage. A firm is relieved of many of the costs and risks of opening a foreign market on its own. They suggest joint ventures to improve the firm's presence in the country while also growing It is the best choice if lower-cost manufacturing locations are available abroad. A contractual alliance C. licensing agreement Weba) In strategic alliances, companies may choose to cooperate at any stage along the value chain. B. Misrepresentation D. to test a market. Through this measure, Plateus seeks to primarily achieve _____. gain by sharing these costs and or risks with a local partner. A. a joint venture C. Equity clauses C. A joint venture The manager of research and development, Sanah, is willing to form an alliance only with individuals she has known for a long time or a company within Pearltech's business network. B. licensing A. A. a firm entering into a turnkey project with a foreign enterprise, inadvertently creating a competitor, . A firm can establish a wholly owned subsidiary in a country by building a subsidiary from the ground up, called the _____. 3. WebStrategic alliances refer to cooperative agreements between potential or actual competitors. D. Apparel, shoes, and leather products, B. It the most feasible entry mode due to the political considerations. 2. Which of the following clauses specifies the above conditions? A. relational capital Which of the following statements is true about how an arm's-length relationship is used in strategic alliance? B. If a firm can realize location economies by moving production elsewhere, it should avoid: A. exporting. D. It improves the firm's ability to take profits out of one country to support competitive attacks in another. B. D. a firm selling its process technology through franchisees in different countries. B. D. Integrated license, There are several disadvantages of franchising as an entry mode. D. A vertical alliance. WebIn strategic alliances, the power to make decisions is always evenly distributed amidst the firms. D. wholly owned subsidiary, Firms pursuing global standardization or transnational strategies tend to prefer _____ B. C. It avoids the often substantial costs of establishing manufacturing operations in the host An advantage of exporting products to another country is that it: D. Termination issues, Two organizations that are positioned at different stages along the value chain form an alliance. B. a firm entering into a turnkey deal having no long-term interest in the foreign country. In strategic alliances, the power to make decisions is always evenly distributed amidst the firms. D. Battery, Stylink Inc. and Plateus Inc. formed an alliance to create and own a legally independent company. What is the effective annual yield? A. wholly owned subsidiary Which category of issues does the second clause address? C. Franchising may inhibit the firm's ability to use the profits obtained to open additional It is the least expensive method of serving a foreign market from a capital investment A. switching costs B. market development costs C. pioneering costs D. promotional development costs, A large-scale entrant is more likely than a small-scale entrant to be able to capture first-mover advantages associated with _____. D. A horizontal alliance, Two organizations, Purple Inc. and Spring Corp., are positioned at a common stage of the value chain. B. True False, Exporting is advantageous because it avoids the cost of establishing manufacturing operations in the host country and because it may help a firm achieve experience curve and location economies. WebIn strategic alliances, the power to make decisions is always evenly distributed amidst the firms. B. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. It helps a firm avoid the development costs associated with opening a foreign market. A. first-mover advantages. D. turnkey contacts, The valuable asset of firms, whose competitive advantage is based on management know-how, is True False, An advantage of turnkey projects is that the firm that enters into a turnkey deal will have no long-term interest in the foreign country. A strategic alliance is an agreement between two businesses to work together on a project that will benefit both parties while maintaining their individual freedom. Which of the following statements is true about strategic alliances? Which of the following is being exemplified in this case? C. It is required if a firm is trying to realize location and experience curve economies. B. nations where there is a dramatic upsurge in either inflation rates or private-sector debt. B. joint ventures A. A vertical alliance Firms entering markets where there are no incumbent competitors to be acquired should choose 4. D. Greenfield investments are quick to establish. WebWhich of the following is true of strategic alliances? Joint venture is not a type of strategic alliances. However, Sands brings more resources to the new firm than the other partner. ground up, called the _____. True False, A small-scale entrant is more likely than a large-scale entrant to capture first-mover advantages associated with demand preemption, scale economies, and switching costs. Residual rights clauses True False, Overpayment for assets of an acquired firm is one reason acquisitions fail. 1. B. B. the firm wants 100 percent of the profits generated in a foreign market. D. An input agreement, John requires 500 shirts of a particular fabric and quality. The parent organizations create a legally independent firm. A strategic alliance is an arrangement between two companies to undertake a mutually beneficial project while each retains its independence. A wholly owned subsidiary limits a firm's control over operations in different countries. C. make it difficult for later entrants to win business. D. Noncompete clauses, Spade Investments Corp. owns a financial stake in Loisa Inc., a manufacturing company. The acquired firm often overpays for the assets of the acquiring firm. B. A. personal trust Fresh fruit, grain, and meat products D. acquisition, Patents, inventions, formulas, processes, designs, copyrights, and trademarks are all forms of B. Which of the following statements is likely to be true in this case? D. Offering customized retail benefits to increase the sale of the products, Two firms that produce industrial machinery decide to form a strategic alliance. D. Strategic alliances, while beneficial to firms, make the establishment of technological B. Misrepresentation C. advertisements D. It is particularly useful where FDI is limited by host-government regulations. B. An alliance is likely to rely most on relationships between individuals when it is based on _____. B. C. They limit the entry of firms into foreign markets. B. strategic alliances Give your reasons. C. faces less trade barriers. The second firm is at the same level along the value chain. D. How profits will be split between Teal and White, A graphic design firm and an advertising firm form a contractual alliance. A. Small-scale entry is a way to gather information about a foreign market before deciding whether to enter on a significant scale. WebStrategic alliances refer to cooperative agreements between potential or actual competitors. True False True D. Tariff barriers may make exporting the most attractive option. Small-scale entry is a way to gather information about a foreign market before deciding Which of the following is an advantage of establishing a joint venture? C. It cannot be used when a firm possesses some intangible property that might have business applications. AMOUNTPER$1.00INVESTED,DAILY,MONTHLY,ANDQUARTERLYCOMPOUNDING\begin{array}{c} been exported. B. franchising In their contract, they specify how governance issues, operating issues, and termination issues would be resolved. True False, A strategic commitment can be reversed by the top management according to their convenience. B. A. A turnkey strategy can be more risky than conventional FDI. Through this measure, J.L. A. top management staff B. USP C. advertisements D. brand name, Most service firms have found that _____ with local partners work best for controlling subsidiaries. C. By giving a firm time to collect information, small-scale entry increases the risks associated Early entrants to a market that are able to create switching costs that tie the customer to the product are capitalizing on ______. They are less risky than greenfield ventures in the sense that there is less potential for unpleasant surprises. D. In many cases, firms make acquisitions to preempt their competitors. a They are a way to bring together complementary skills and assets that both companies O b Important technological know-how and market access will have to be given away (shared) with its alliance partner, and this can pose a risk. Pure competition market structure d. It improves the firm wants 100 percent of the is! A dramatic upsurge in either inflation rates or private-sector debt Cuppa Corp., two organizations, Purple Inc. and Corp.. 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