InternationalMarketing

Topics: Joint venture, Strategic alliances, License Pages: 9 (6288 words) Published: October 24, 2014
Chapter 9 Global Market Entry Strategies Licensing, Investment, and Strategic Alliances 1) Companies like Bill Blass, Hugo Boss, and other global design icons typically generate more revenue from licensing deals for jeans, fragrances, and watches than from their high-priced couture lines. Answer TRUE Diff 2Page Ref 265-267 AACSB Reflective Thinking 2) Licensing is a contractual agreement whereby one company (the licensor) makes a legally protected asset available to another company (the licensee) in exchange for royalties, license fees, or some other form of compensation. Answer TRUE Diff 1Page Ref 265 3) Licensing enables companies to circumvent tariffs, quotas, or similar export barriers. Answer TRUE Diff 2Page Ref 266 AACSB Reflective Thinking 4) Licensing agreements offer unlimited market control. Answer FALSE Diff 2Page Ref 266 AACSB Reflective Thinking 5) Apples failure to license its technology in the pre-Windows era arguably cost the company tens of billions of dollars. Answer TRUE Diff 2Page Ref 267 6) Companies may find that the upfront easy money obtained from licensing turns out to be a very expensive source of revenue. Answer TRUE Diff 2Page Ref 267 AACSB Reflective Thinking 7) Sony was the first company to manufacture and market a transistor radio. Answer FALSE Diff 2Page Ref 267 AACSB Reflective Thinking 8) Sonys worldwide success in manufacturing and marketing transistor radios in the 1950s stemmed from its joint venture arrangement with an American corporation. Answer TRUE Diff 1Page Ref 267 9) One of the cornerstones of Apple Computers business strategy has been licensing its famed operating system. Answer TRUE Diff 2Page Ref 267 AACSB Reflective Thinking 10) Starbucks relentless pursuit of new market opportunities in Germany and other countries illustrates the fact that most firms face a limited range of strategy alternatives. Answer FALSE Diff 1Page Ref 265 AACSB Reflective Thinking 11) A company that emphasizes direct investment as a market entry strategy is subject to a higher degree of political risk than a company that relies heavily on exporting. Answer TRUE Diff 1Page Ref 265 AACSB Reflective Thinking 12) Franchising is a variation of licensing strategy in which there is a contract between the parent company franchiser and a franchisee that allows the franchisee to operate a business developed by the franchiser in return for all rights for operations. Answer FALSE Diff 2Page Ref 267 AACSB Reflective Thinking 13) In China, regulations require foreign franchisers to directly own two or more stores for a minimum of one year before franchising. Answer TRUE Diff 1Page Ref 269 AACSB Analytic Skills 14) McDonalds has the largest number of overseas sites according to a listing in the Wall Street Journal (2006). Answer FALSE Diff 1Page Ref 268 15) Franchising in a global market is actually a market entry strategy that is typically executed with less localization than licensing. Answer TRUE Diff 2Page Ref 269 AACSB Reflective Thinking 16) Foreign direct investment figures reflect investment flows out of the home country as companies invest in or acquire plants, equipment, or other assets. Answer TRUE Diff 2Page Ref 269-270 AACSB Reflective Thinking 17) Foreign investment can take the form of outright acquisition. Answer TRUE Diff 2Page Ref 270 AACSB Reflective Thinking 18) A joint venture with a local partner represents another form of strategy that is similar to exporting and licensing. Answer FALSE Diff 2Page Ref 270-271 AACSB Reflective Thinking 19) A lesson that can be learned from Anheuser-Buschs experience in Japan is that it is better to give control to a local partner via a licensing agreement rather than making a major investment. Answer TRUE Diff 2Page Ref 271-272 AACSB Analytic Skills 20) The joint venture between Corning Glass and Mexican manufacturer Vitro failed primarily due to conflicts arising out of cultural differences. Answer TRUE...
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