B. joint ventures Many American firms that sold oil-refining technology to firms in the Gulf now find themselves competing with these firms in the world oil market. Strategic alliances can make entry into a foreign market difficult. the alliance partner. A firm that enters long-term alliances is expanding its strategic flexibility by committing to its alliance partners. B. A. Greenfield investments B. Web1) Strategic alliances are commonly found in markets where there is a pure competition market structure. Ability to preempt rivals and capture demand by establishing a strong brand name B. make it easy for later entrants to win business. A. How intellectual property will be shared by Teal and White 8.25\% & 1.085988 & 1.085692 & 1.085087 & 1.390916 & 1.389398 & 1.386306\\ A. Jades Inc., which manufactures the packages required for finished products of Hues C. greenfield investment, The most typical joint venture is a _____ venture. A wholly owned subsidiary is appropriate when the firm wants: Joint ventures give a firm a tight control over subsidiaries that it might need to realize The commitment associated with a small-scale entry makes it possible for the small-scale Combining unique resources along different stages of the value chain D. Greenfield investments are quick to establish. A. B. D. consumer durables, _____ is pursued primarily by manufacturing firms and _____ is employed primarily by service D. franchising. There is nothing as trust between the firm and its suppliers in strategic alliances. C. Ability to capitalize on the work done by other firms A. True False, In a turnkey project, the contractor agrees to handle every detail of the project for a foreign client. C. In strategic alliances, companies may choose to cooperate at any stage along the value chain. strategic alliance. foreign market. them. C. A distribution agreement A . D. Firm risks giving away technological know-how and market access to its alliance partner. A. AnnualRate7.00%7.25%7.50%7.75%8.00%8.25%8.50%8.75%9.00%9.25%Daily1.0725001.0751851.0778751.0805731.0832771.0859881.0887061.0914301.0941621.096900Monthly1.0722901.0749581.0776321.0803121.0829991.0856921.0883901.0910951.0938061.096524Quarterly1.0718591.0744951.0771351.0797811.0824321.0850871.0877471.0904131.0930831.095758Daily1.3230941.3363891.3498171.3633801.3770791.3909161.4048911.4190081.4332651.447666Monthly1.3220531.3352611.3485991.3620661.3756661.3893981.4032641.4172661.4314051.445682Quarterly1.3199291.3329611.3461141.3593881.3727851.3863061.3999511.4137231.4276211.441647. Licensing is used when a firm possesses some tangible property but does not want to pursue Which of the following is one of the reasons why acquisitions fail? Which of the following is true of wholly owned subsidiaries? An arrangement whereby a firm grants the right of intangible property to another entity for a specified time period in exchange for royalties is a(n) _____ agreement. A. a joint venture 2. The fixed costs and associated risks of developing new products or processes are borne by Strategic alliances are not as commonplace today as they were two decades ago. C. politically stable developed and developing nations that have free market systems. B. A. relational capital them. A. first-mover advantages B. pioneering costs C. economies of scale D. late-mover advantages, Which of the following is a first-mover advantage? B. provides the ability to achieve experience curve and location economies. In strategic alliances, companies may choose to cooperate at any stage along the value chain. 7.25\% & 1.075185 & 1.074958 & 1.074495 & 1.336389 & 1.335261 & 1.332961\\ Which of the following statements about franchising is true? c)Strategic alliances exclude functions that are bought through bidding. prior to its rivals are known as _____. Fresh fruit, grain, and meat products D. How profits will be split between Teal and White, A graphic design firm and an advertising firm form a contractual alliance. B. reduce the level of conflicts that occur within an organization. Which of the following is true of wholly owned subsidiaries? Which of the following alliances will be best suited for the organization? C. Low transportation costs may make exporting uneconomical. How much direct labor should be debited to Work in Process? B. greenfield investment D. Interdependence between the two firms is not likely to be low. C. Takeovers A. wholly owned subsidiary D. give later entrants a cost advantage over early entrants. True False, Unlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. them? D. a firm selling its process technology through franchisees in different countries. What is the primary advantage of licensing? C. a horizontal alliance D. In many cases, firms make acquisitions to preempt their competitors. True False, By its very nature, licensing increases a firm's ability to utilize a coordinated strategy. C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. Firm risks giving away technological know-how and market access to its alliance partner. C. shared equity Which category of issues does the second clause address? WebWhich of the following statements is true of strategic alliances? C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. C. Greenfield investments virtually eliminate the possibility of a more aggressive global competitor Weba) In strategic alliances, companies may choose to cooperate at any stage along the value chain. Plateus describes the terms and conditions of different grades of partnership on its website, allowing potential partners to choose which level fits them best. C. They limit the entry of firms into foreign markets. A. Turnkey projects are most common in industries which use simple, inexpensive production primarily seeks to achieve _____. B. C. By sharing only the technology of the firm, not the patents and copyrighted information. D. Noncompete clauses, Spade Investments Corp. owns a financial stake in Loisa Inc., a manufacturing company. A strategic alliance is an agreement between two firms to collaborate on a mutually advantageous initiative while maintaining each company's independence. AMOUNTPER$1.00INVESTED,DAILY,MONTHLY,ANDQUARTERLYCOMPOUNDING, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Fundamentals of Financial Management, Concise Edition, Chemistry 120 Chapter 1 Chemical Foundation. b)Strategic alliances usually lead to one of the firms losing its relational advantage. D. Battery, Stylink Inc. and Plateus Inc. formed an alliance to create and own a legally independent company. Which of the following statements is true about how an arm's-length relationship is used in strategic alliance? 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. D. Creating product differentiation, _____ occurs when one partner tries to exploit the alliance-specific investments made by another partner. It the most feasible entry mode due to the political considerations. \text{Standard rate for direct labor}&\text{\$16.00 per hr. Firms within the network could result in inbreeding of ideas. D. venture capital, A _____ entails establishing a firm that is owned together by two or more otherwise independent B. exporting D. a distribution agreement, Green Dye Inc., a manufacturing firm that produces organic products, is approached by Zoe, a leading clothes designer owning her own label. Lance is a 161616 -year-old high school junior. In strategic alliances, the firm-supplier relationship remains market mediated and terminable if the supplier fails to perform. D. wholly owned subsidiary contracts, Firms entering a market via a _____ must bear all the costs and risks associated with the venture. D. Strategic alliances usually lead to In return, the company is willing to pay a percentage of revenue to the agro-based industry. It avoids the often substantial costs of establishing manufacturing operations in the host C. Subsidiaries B. legal contracts It allows individual companies to achieve more By its very nature, _____ limits a firm's ability to utilize a coordinated strategy. B. Strategic alliances can make entry into a foreign market difficult. C. It is also an attractive option when a firm is interested in pursuing a foreign market and is ready C. A coordination alliance Web1) Strategic alliances are commonly found in markets where there is a pure competition market structure. They are a way to bring together complementary skills and assets that both companies develop. In strategic alliances, the firm-supplier relationship remains market mediated and terminable if the supplier fails to perform. Inc., a manufacturing company, develops manuals that include tools for making a business case, a partner-evaluation form, a negotiations template outlining the roles and responsibilities of different departments, and a list of ways to measure the performance of collaborating partners. C. pioneering costs D. Franchising may inhibit the firm's ability to take profits out of one country to support, D. Franchising may inhibit the firm's ability to take profits out of one country to support, In many countries, political considerations make _____ the only feasible entry mode. 3. The parent organizations create a legally independent firm. D. Profit stealing, The research and development department of a pharmaceutical company is in the process of developing a new drug to cure Parkinson's disease. AMOUNTPER$1.00INVESTED,DAILY,MONTHLY,ANDQUARTERLYCOMPOUNDING\begin{array}{c} C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. WebWhich of the following statements is true about strategic alliances? True False True C. low transaction costs Sepia Inc., a fertilizer company, needs permission to test its new products on plantations owned by an agro-based industry. A. Hold-up B. B. d)In strategic. A. turnkey B. licensing C. greenfield D. acquisition, Patents, inventions, formulas, processes, designs, copyrights, and trademarks are all forms of _____. A disadvantage of _____ is that the firm that enters into such an arrangement will have no long-. B. licensing agreement It is a time-consuming process and takes a lot of time to execute. Firms benefit from a local partner's knowledge of the host country's competitive conditions. WebA drawback involved in using cross-border strategic alliances to enter new foreign markets is that: some of the firm's proprietary know-how may be appropriated by the foreign partner The Mansion Hotel Group purchased Red Brick Hotels for an estimated value of $120 billion. A. chartering . Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. D. a firm selling its process technology through franchisees in different countries. managers. A horizontal alliance A. None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner In strategic alliances, companies may choose to cooperate at any stage along the value chain. B. C. advertisements The arrangement is less complicated and less enforceable than a joint venture, in which two firms combine their resources to form a new company organization. C. a country subsequently proving to be a major market for the output of the process that has been exported. AMOUNTPER$1.00INVESTED,DAILY,MONTHLY,ANDQUARTERLYCOMPOUNDING, InterestPeriod-1yearInterestPeriod-4years\begin{array}{c} A. transportation B. high-technology C. construction D. consumer durables, _____ is pursued primarily by manufacturing firms and _____ is employed primarily by service firms. Which of the following suppliers is it most likely to choose as a partner? B. Through this measure, J.L. D. promotional development costs, A large-scale entrant is more likely than a small-scale entrant to be able to capture first-mover D. cross-licensing, Cross-licensing agreements are increasingly common in the _____ industries. Which of the following statements about small-scale entry is true? A. D. Foreign franchises controlled by joint ventures, D. Foreign franchises controlled by joint ventures. To increase the potential for a successful acquisition, a firm should: country. D. Strategic alliances, while beneficial to firms, make the establishment of technological A firm is relieved of many of the costs and risks of opening a foreign market on its own. D. Integrated license, There are several disadvantages of franchising as an entry mode. Strategic alliances can make entry into a foreign market difficult. He gathers the alcohol left over from his parents' New Year's party and decides to throw a party at his house on a Saturday night when his parents are out of town. C. a plant that is ready to operate. A. scale economies A. joint venture B. turnkey strategy C. licensing agreement D. greenfield strategy. entrant to capture first-mover advantages. D. seek companies only from similar national cultures. Strategic alliances usually lead to one of the firms losing their relational advantage. 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. The commitment associated with a small-scale entry makes it possible for the small-scale entrant to capture first-mover advantages. A. Hold-up C. turnkey contracts; exporting B. relational assets A strategic alliance is an arrangement between two companies to undertake a mutually beneficial project while each retains its independence. An air conditioner manufacturer, Hues Corp., decides to form a strategic alliance with a firm to source components that make up the highest percentage of total costs. D. Firm risks giving away technological know-how and market access to its alliance partner. WebUnlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. A licensing agreement C. Dispute resolution clauses This is an example of: C. franchisee A. switching costs D. late-mover advantages. b)Strategic alliances usually lead to one of the firms losing its relational advantage. True False, Relational capital refers to the building of interpersonal relationships between the firms' managers in a strategic alliance. standpoint. A. Zeal Inc., a software firm, decides to enter the publishing industry. license some of its valuable know-how to the firm. behave in an opportunistic manner toward each other. They enter into a strategic alliance in which they create and own a legally independent company. C. intangible property Black Corp., which prints Hues logo on the air conditioners Joint ventures with local partners do not face any risk of being subject to nationalization or Joint venture is not a type of strategic alliances. A vertical alliance C. turnkey operation B. licensing with a subsequent large-scale entry. In this case, which of the following contractual alliances should be adopted by Sepia? B. franchising agreements A. A firm can establish a wholly owned subsidiary in a country by building a subsidiary from the ground up, called the _____. Voting rights clauses A. legal contracts B. franchising arrangement B. A firm takes profits out of one country to support competitive attacks in another. While it has the financial resources required to enter the new market, it lacks the expertise and technical knowledge required to establish itself in the new industry. Prepare a written outline of the points of your presentation. A. Which of the following is being exemplified in this scenario? A. What is the effective annual yield? B. optimal choice? B. The choice of which markets to enter should be driven by an assessment of relative long-run growth and profit potential. B. A contractual alliance Under a(n) _____ agreement, a firm might license some valuable intangible property to a foreign partner, but in addition to a royalty payment, the firm might also request that the foreign partner license some of its valuable know-how to the firm. the business opportunities for companies in the developing country. Which of the following is true of acquisitions? The expense function is E = 19,000p + 6,300,000 and the revenue function is, R=1,000p2+155,000p{ R } = - 1,000 p ^ { 2 } + 155,000 p A supply agreement It the most feasible entry mode due to the political considerations. A. Greenfield investments Answer questions from your audience about the feature and how to use it. A. a firm entering into a turnkey project with a foreign enterprise, inadvertently creating a D. The firm has to bear the development costs and risks associated with opening a foreign market. True False, Cross-licensing agreements can be used to formalize arrangements to swap skills and technology in a strategic alliance. }\\ D. turnkey projects, Turnkey projects are most common in which of the following industries? A. A. drive early entrants out of the market. partner contributes to the venture. gain by sharing these costs and or risks with a local partner. In a ____, the firm owns 100 percent of the stock. WebStrategic alliances refer to cooperative agreements between potential or actual competitors. True False, First-mover advantages are the advantages associated with entering a market early. }\\ Which of the following is a first-mover advantage? There is a clash between the cultures of the acquired and the acquiring firms. B. wholly owned subsidiary; exporting C. franchising B. diseconomies of scale Joint venture is not a type of strategic alliances. C. Under which circumstances Teal or White can exit the alliance It does not give a firm the tight control over strategy that is required for realizing experience Which of the following is an advantage of franchising? An equity alliance D. It is particularly useful where FDI is limited by host-government regulations. C. It guarantees consistent product quality and achieves experience curve and location C. licensing. D. seek companies only from similar national cultures. Spade's resources help the organization increase productivity, which results in increased sales and profits. D. wholly owned subsidiaries. B. Misrepresentation Joint ventures Chemical, pharmaceutical, and metal refining. B. It is the least expensive method of serving a foreign market from a capital investment WebFor a strategic alliance, firms should seek partners that are: a.willing to share costs and risks of new-product development.b.known for being opportunistic.c.similar when it comes to capabilities.d.radically different when it comes to strategic B. It requires additional resources to complete the process. In the first clause, they specify how decisions will be made, how profits will be split, and how disputes will be resolved. Which of the following statements is true about strategic alliances? A. licensing; joint-venture A turnkey strategy can be more risky than conventional FDI. C. pioneering costs C. The parent firms share revenues and expenses in a particular ratio. The firm incurs many of the costs and risks of opening a foreign market on its own. Strategic alliances are not as commonplace today as they were two decades ago. WebIn strategic alliances, the power to make decisions is always evenly distributed amidst the firms. The objective of this collaboration is to combine their manufacturing facilities to achieve economies of scale during production. D.Small-scale entry limits a firm's ability to learn about a foreign market thereby also limiting the firm's exposure to that market. Strategic alliances can make entry into a foreign market difficult. C. share the risks of developing new products or processes. B. C. Cooperation between the two firms is not likely to depend on cross-equity holdings. 4. B. a firm entering into a turnkey deal having no long-term interest in the foreign country. The costs and risks associated with doing business in a foreign country are typically: A. low in an economically advanced nation. Which of the following is a distinct advantage of exporting? A. \text{Standard direct labor per bicycle}&\text{2 hrs. Franchising; licensing C. Franchising; exporting D. 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