Which of the following is likely to be covered under the clause that deals with governance issues? D. turnkey projects, A firm can establish a wholly owned subsidiary in a country by building a subsidiary from the None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner Through this measure, J.L. A. turnkey True False, An alliance is a way to bring together complementary skills and assets that neither company could easily develop on its own. B. licensing agreements Joint venture is not a type of strategic alliances. A. C. Subsidiaries 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 Strategic alliances In a(n) _____, the contractor agrees to handle every detail of the project for a foreign client. C. goodwill trust WebQuestion: Which of the following statements is true about strategic alliances? Early entrants to a market that are able to create switching costs that tie the customer to the that technology. B. True False, Brand names are generally well-protected by international laws pertaining to trademarks. A firm that enters long-term alliances is expanding its strategic flexibility by committing to its alliance partners. 60/40 Through this measure, Plateus seeks to primarily achieve _____. WebUnlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. Ability to preempt rivals and capture demand by establishing a strong brand name C. It avoids the often substantial costs of establishing manufacturing operations in the host WebQuestion: Which of the following statements is true about strategic alliances? In the second clause, they specify how intellectual property will be shared and protected. 4) A company that. Joint ventures give a firm a tight control over subsidiaries that it might need to realize If a firm can realize location economies by moving production elsewhere, it should avoid _____. D. increase the cultural similarities between employees. WebWhich of the following statements is true of strategic alliances? D. A contractual alliance, Borpon Inc. and Biocolog Corp. are well-established biotechnology companies. gain by sharing these costs and or risks with a local partner. B. licensing agreement c)Strategic alliances exclude functions that are bought through bidding. C. They limit the entry of firms into foreign markets. A. wholly owned subsidiary B. B.Joint ventures give a firm a tight control over subsidiaries that it might need to realize experience curve or location economies. _____. An alliance is likely to rely most on relationships between individuals when it is based on _____. Joint ventures with local partners do not face any risk of being subject to nationalization or other forms of adverse government interference. them? WebIn strategic alliances, the power to make decisions is always evenly distributed amidst the firms. D. Contractual safeguards, _____ refers to the building of interpersonal relationships between the firms' managers in a A vertical alliance Which of the following is true of acquisitions? B. Joint venture is not a type of strategic alliances. D. In many cases, firms make acquisitions to preempt their competitors. WebWhich of the following statements is true about strategic alliances? After the survey, the management discusses the issues brought up by the employees and their suggestions. It helps a firm avoid the development costs associated with opening a foreign market. B. try to acquire a firm with a very different corporate culture so there is no forced "overlap." C. It is required if a firm is trying to realize location and experience curve economies. C. intervention and accountability They suggest that franchising should be used in order to minimize risk and allow for the C. a turnkey strategy B. diseconomies of scale \text{Bicycles completed in September}&\text{400}\\ A. integrated licensing B. chartering C. franchising D. cross-licensing, Cross-licensing agreements are increasingly common in the _____ industries. It does not help firms that lack capital to develop operations overseas. The following data for September of the current year are available: Quantityofdirectlaborused850hrs.Actualratefordirectlabor$15.60perhr.BicyclescompletedinSeptember400Standarddirectlaborperbicycle2hrs.Standardratefordirectlabor$16.00perhr.\begin{array}{lrr} A. turnkey project B. joint venture C. greenfield investment D. licensing arrangement, The most typical joint venture is a _____ venture. C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. It the most feasible entry mode due to the political considerations. B. licensing contracts It helps a firm avoid the development costs associated with opening a foreign market. A turnkey strategy can be more risky than conventional FDI. D. a firm selling its process technology through franchisees in different countries. Licensing agreements B. Pooling similar resources C. When the development costs and/or risks of opening a foreign market are high, a firm might the host country's competitive conditions, culture, language, political systems, and business Acquisitions WebUnlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. 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 _____. A. B. 2. A. B. C. 75/25 Which of the following statements is true about firms in a joint venture? The commitment associated with a small-scale entry makes it possible for the small-scale entrant to capture first-mover advantages. They retain their individual ownership; however, they agree to share production facilities and manpower, and they also decide to market their products through combined promotional tools. C. a country subsequently proving to be a major market for the output of the process that has been exported. It does not help firms that lack capital to develop operations overseas. D. Firm risks giving away technological know-how and market access to its alliance partner. D. Battery, Stylink Inc. and Plateus Inc. formed an alliance to create and own a legally independent company. D. A profit agreement, Velara Inc., a healthcare company, owns 35% stake in the firm that supplies most of its raw materials. businesses in the same country. A. C. Takeovers True False, If a firm is trying to enter a market where there are already well-established companies, and where global competitors are also interested in establishing a presence, the firm should choose a greenfield investment. Franchising; licensing True False, Franchising enables a firm to quickly build a global presence. D. wholly owned subsidiaries. How can a firm protect its proprietary information in a joint venture arrangement? Voting rights clauses A. C. make it difficult for later entrants to win business. A. misvaluation theory B. performance extrapolation hypothesis C. market timing theory D. hubris hypothesis. technologies. WebWhich of the following statements is true about strategic alliances with suppliers? A strategic alliance is an arrangement between two companies to undertake a mutually beneficial project while each retains its independence. QuantityofdirectlaborusedActualratefordirectlaborBicyclescompletedinSeptemberStandarddirectlaborperbicycleStandardratefordirectlabor850hrs.$15.60perhr.4002hrs.$16.00perhr.. Firms within the network could result in inbreeding of ideas. . He partners with Loumang Inc., a fabric manufacturing company, to develop certain customized inputs. In strategic alliances, companies may choose to cooperate at any stage along the value chain. 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 strengthens Sanah's argument? country. C. Exit issues D. Firms that enter into a turnkey deal have a long-term interest in the foreign country. C. politically stable developed and developing nations that have free market systems. Which category of issues does the second clause address? By its very nature, _____ limits a firm's ability to utilize a coordinated strategy. 4. B. Misrepresentation True False, A strategic commitment can be reversed by the top management according to their convenience. WebWhich of the following statements is true of strategic alliances? other forms of adverse government interference. C . \end{array} company could easily develop on its own. They limit the entry of firms into foreign markets. B. C. A distribution agreement B. joint venture 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. Small-scale entry is a way to gather information about a foreign market before deciding WebWhich of the following is true of strategic alliances? D. wholly owned subsidiaries. True False, The value an international business creates in a foreign market depends on the suitability of its product offering to that market and the nature of indigenous competition. D. licensing agreement, _____ can be used to formalize arrangements to swap skills and technology in a strategic alliance. D. Den Corp., which produces the designer vents for Hues that come in different colors, Crimson Corp., a painting unit, collaborates with a car manufacturing company. must employ _____. A firm takes profits out of one country to support competitive attacks in another. C. Lowering the transaction costs at all stages of the value chain If necessary, use online help, tutorials, or manuals for the software. D. Team building. D. 10/90. B. B. turnkey strategy Joint ventures with local partners do not face any risk of being subject to nationalization or C. It guarantees consistent product quality and achieves experience curve and location economies. C. Bondage A. Hold-up They are always focused on joining the same value chain activities. A . C. greenfield investment True False, Educating customers is a part of pioneering costs. c)Strategic alliances exclude functions that are bought through bidding. A. Alliance partnerships D. Apparel, shoes, and leather products, B. B. turnkey contracts. C. In strategic alliances, companies may choose to cooperate at any stage along the value chain. He sees his friend Abby finish a beer, grab her car keys, and walk out the door to go home. The firm does not have to bear the development costs and risks associated with opening a According to the _____, top managers typically overestimate their ability to create value from an acquisition. C. Low transportation costs may make exporting uneconomical. The choice of which markets to enter should be driven by an assessment of relative long-run growth and profit potential. They limit the entry of firms into foreign markets. C. turnkey project 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 global competitors are also interested in establishing a presence, the firm should choose a(n) D. It is appropriate if lower cost locations for manufacturing the product can be found abroad. C. The synergies of the two firms happens quickly and neither acquired nor acquiring firm are It allows individual companies to achieve more D. In many cases, firms make acquisitions to preempt their competitors. C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. C. faces less trade barriers. True False, An advantage of joint ventures with a local partner is the knowledge of the local environment that the local partner contributes to the venture. D. Tariff barriers may make exporting the most attractive option. B. D. diseconomies of scope. True False, The costs and risks associated with doing business in a foreign country are typically high in an economically advanced and politically stable democratic nation. Which of the following is a disadvantage of licensing? B. B. licensing develop. B. nations where there is a dramatic upsurge in either inflation rates or private-sector debt. An inherent degree of uncertainty is associated with a greenfield venture because of future WebWhich of the following is true of strategic alliances? B. They enable firms to achieve goals faster, but at higher costs. B. joint venture B. wholly owned subsidiary; exporting WebChapter 8 - Multiple Choice - Chapter 8: Strategic Alliances Multiple Choice Questions Zeal Inc., a - Studocu Multiple Choice chapter strategic alliances multiple choice questions zeal inc., software firm, decides to enter the publishing industry. C. They are known as strategic alliances whether or not they have the potential to affect a firm's competitive advantage. partner, but in addition to a royalty payment, the firm might also request that the foreign partner 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. 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. To convince another pharmaceutical company to provide the necessary resources, it gives false information about how long the drug has been in the developmental pipeline and the guidelines followed in the production process. What is the effective annual yield? B. B. provides the ability to achieve experience curve and location economies. 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. C. Bondage True False, Exporting is most appropriate when lower-cost locations for manufacturing the product can be found abroad. advantages associated with _____. Firm risks giving away technological know-how and market access to its alliance partner. The costs of promoting and establishing a product offering when a firm enters a foreign market prior to its rivals are known as _____. A. Greenfield investments B. A. switching costs WebWhich of the following statements is true of strategic alliances? Weba) In strategic alliances, companies may choose to cooperate at any stage along the value chain. B. B. increased external visibility The firm incurs many of the costs and risks of opening a foreign market on its own. C. make it difficult for later entrants to win business. B. turnkey contract They enable firms to achieve goals faster, but at higher costs. D. the firm wants to test a market. WebWhich of the following statements is true of strategic alliances? A. Turnkey Other things being equal, the benefit-cost-risk trade-off is likely to be most favorable in: B. It is a time-consuming process and takes a lot of time to execute. True False, Large strategic commitments increase strategic flexibility. WebQuestion: Which of the following statements is true about strategic alliances? A. Hold-up Stefan and the driver of the other car are seriously injured. Spade's resources help the organization increase productivity, which results in increased sales and profits. B. make it easy for later entrants to win business. True False, Licensing limits the firm's ability to realize experience curve and location economies by producing its product in a centralized location. A. licensing; joint-venture B. wholly owned subsidiary; exporting C. turnkey contracts; exporting D. exporting; joint-venture, If a high-tech firm sets up operations in a foreign country to profit from a core competency in technological know-how, which of the following entry strategy is best? A. transportation B. high-technology C. construction D. consumer durables, _____ is pursued primarily by manufacturing firms and _____ is employed primarily by service firms. B. A. organized alliance-management knowledge B.It does not give a firm the tight control over strategy that is required for realizing experience curve and location economies. In this case, the relationship between the two firms is based primarily on _____. to learn from these competitors by benchmarking their operations and performance against 60/40 C. 75/25 D. 10/90. prepared for full integration. A. top management staff Managing an alliance successfully requires building interpersonal relationships between the firms' managers. D. turnkey contacts, The valuable asset of firms, whose competitive advantage is based on management know-how, is 50/50 C. greenfield investments 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. A firm is relieved of many of the costs and risks of opening a foreign market on its own. C. licensing agreement 8.75\% & 1.091430 & 1.091095 & 1.090413 & 1.419008 & 1.417266 & 1.413723\\ True False, Acquisitions rarely produce disappointing results. A. _____. The objective of this collaboration is to combine their manufacturing facilities to achieve economies of scale during production. B. increased external visibility A. A. turnkey B. licensing C. greenfield D. acquisition, Patents, inventions, formulas, processes, designs, copyrights, and trademarks are all forms of _____. AMOUNTPER$1.00INVESTED,DAILY,MONTHLY,ANDQUARTERLYCOMPOUNDING, InterestPeriod-1yearInterestPeriod-4years\begin{array}{c} Which of the following suppliers is it most likely to choose as a partner? A. Hold-up Franchising Which of the following is being exemplified in this case? Joint ventures A. a firm entering into a turnkey project with a foreign enterprise, inadvertently creating a . Early entrants to a market that are able to create switching costs that tie the customer to the product are capitalizing on ______. \end{array} A. transportation B. competitor. A. A. misvaluation theory D. The firm is deprived of the knowledge of the host country's competitive conditions, culture, language, etc. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. A. of developing new products or processes. A contractual alliance A. Voting rights clauses A. licensing agreements 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. So, Zeal Inc. enters into strategic alliance with Chrome Corp., a leading e-publisher. Franchising; licensing C. Franchising; exporting D. Exporting; licensing, If a service firm wants to build a global presence quickly and at a relatively low cost and risk, it must employ _____. D. late-mover advantages. C. operational assets C. They give the firm a much greater ability to build the kind of subsidiary company that it wants. C. licensing agreements A. scale economies B. diseconomies of scale C. pioneering costs D. diseconomies of scope. A. 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. It requires additional resources to complete the process. been exported. Many American firms that sold oil-refining technology to firms in the Gulf now find themselves They sign a contract that specifies the tasks of each party in alliance. d)In strategic. }\\ competing with these firms in the world oil market. A strategic alliance is an agreement between two firms to collaborate on a mutually advantageous initiative while maintaining each company's independence. Which of the following is being exemplified in this scenario? A. first-mover advantages. 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. There is nothing as trust between the firm and its suppliers in strategic alliances. B. franchises D. increased profits, Oral Mucous Membrane & Tongue - Chapters 23/2, John David Jackson, Patricia Meglich, Robert Mathis, Sean Valentine, Service Management: Operations, Strategy, and Information Technology, Information Technology Project Management: Providing Measurable Organizational Value. 9.00\% & 1.094162 & 1.093806 & 1.093083 & 1.433265 & 1.431405 & 1.427621\\ Which of the following clauses specifies the above conditions? Black Corp., which prints Hues logo on the air conditioners A. 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. Hoschild Bicycle Company manufactures bicycles. A. C. Strategic alliances allow firms to bring together complementary skills and assets that neither True False, Contractual safeguards cannot be written into an alliance agreement to guard against the risk of opportunism by a partner. Switching costs: True False, Acquisitions are quick to execute. C. politically stable developed and developing nations that have free market systems. C. Lowering distribution costs 7.00\% & 1.072500 & 1.072290 & 1.071859 & 1.323094 & 1.322053 & 1.319929\\ It gives a firm the tight control over manufacturing, marketing, and strategy. firms. A. joint ventures entering the market via acquisitions. They enter into a strategic alliance in which they create and own a legally independent company. Describe the proximity of the wettest areas of the savanna in East Africa to the Equator. It guarantees consistent product quality. A horizontal alliance They are always focused on joining the same value chain activities. Is it fair to hold Lance responsible in either situation? True False True D. Noncompete clauses, Spade Investments Corp. owns a financial stake in Loisa Inc., a manufacturing company. Which of the following is true of strategic alliances? If a firm can realize location economies by moving production elsewhere, it should avoid: A. exporting. 4) A company that. It cannot contribute the same level of financial resources, although it can contribute an extensive level of knowledge. It helps a firm avoid the development costs associated with opening a foreign market. D. franchising, If a firm is trying to enter a market where there are already well-established companies, and where D. increased profits, Plateus Inc., a software company, has a website that gives detailed information about partnering processes for firms that seek collaboration with Plateus. D. Firm risks giving away technological know-how and market access to its alliance partner. C. It is required if a firm is trying to realize location and experience curve economies. It tends to involve more short-term commitments than licensing. A. None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner D. Greenfield investments are quick to establish. D. acquisition, A(n) _____ is a way to bring together complementary skills and assets that neither company could Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. C. It cannot be used when a firm possesses some intangible property that might have business D. It is employed primarily by manufacturing firms. specified time period in exchange for royalties is a(n) _____ agreement. WebQuestion: QUESTION 13 Which of the following statements is true of strategic alliances? D. They suggest that companies should use the entry of foreign multinationals as an opportunity A. A. They limit the entry of firms into foreign markets. C. franchising A. a firm entering into a turnkey project with a foreign enterprise, inadvertently creating a competitor, . Joint management They are always focused on joining the same value chain activities. country. 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. Web1) Strategic alliances are commonly found in markets where there is a pure competition market structure. The second firm is at the same level along the value chain. A. A. exporting C. Firms outside the network widen the scope of research solutions. C. acquisitions. A. Turnkey projects are most common in industries which use simple, inexpensive production technologies. C.By giving a firm time to collect information, small-scale entry increases the risks associated with a subsequent large-scale entry. Which of the following is a distinct advantage of exporting? The editor has asked you to show her writers a software feature that will make their job easier. True False, Costs that an early entrant has to bear that a later entrant can avoid are known as first-mover costs. B. d)In strategic. In return, the company is willing to pay a percentage of revenue to the agro-based industry. A supply agreement What performance is expected by Teal and White from each other Redwood Inc., has an arm's-length relationship with Blue Ink Corp. D. promotional development costs, A large-scale entrant is more likely than a small-scale entrant to be able to capture first-mover D. franchising agreement. 3. The costs of promoting and establishing a product offering when a firm enters a foreign market Weba) In strategic alliances, companies may choose to cooperate at any stage along the value chain. Which of the following is a disadvantage of licensing? A. joint venture C. D. A joint venture, An organization enters into an alliance with a firm that is positioned at a different stage along the value chain. B. collateral bonds 4) A company that. C. SeaShade produces beach umbrellas. True False False An alliance is a way to bring together complementary skills and assets that neither company could easily develop on its own. B. licensing D. Foreign franchises controlled by joint ventures, D. Foreign franchises controlled by joint ventures. D. franchising. _____ refer to cooperative agreements between potential or actual competitors. and _____ arrangements should be avoided if possible to minimize the risk of losing control over It allows individual companies to achieve more B. A. relational capital 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. A. licensing contract The contributions made by individual firms are easy to measure. Chemical, pharmaceutical, and metal refining. WebWhich of the following statements is true about strategic alliances? D. Small-scale entry limits a firm's ability to learn about a foreign market thereby also limiting the C. share the risks of developing new products or processes. A. In their contract, they specify how governance issues, operating issues, and termination issues would be resolved. Victor Corp., a high-end mobile manufacturer that targets business people, decides to increase its customer base. A. joint venture the business opportunities for companies in the developing country. 7.50\% & 1.077875 & 1.077632 & 1.077135 & 1.349817 & 1.348599 & 1.346114\\ It forms a strategic alliance with Gray Inc. to produce new instruments designed to attract students. B. They form an alliance to benefit from complementary activities. C. economies of scale. D. A horizontal alliance, Two organizations, Purple Inc. and Spring Corp., are positioned at a common stage of the value chain. These profits are shared among the partners in a particular ratio. Plateus describes the terms and conditions of different grades of partnership on its website, allowing potential partners to choose which level fits them best. B. 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Which they create and own a legally independent company opportunities for companies the... Turnkey deal have a long-term interest in the developing country into foreign markets with a large-scale... Property will be shared and protected early entrants to win business other things being equal the! Inc., a high-end mobile manufacturer that targets business people, decides to increase customer! This measure, Plateus seeks to primarily achieve _____ has been exported of exporting that will their. Products, B beneficial project while each retains its independence avoid: a. exporting of financial,! Enter the global market to its alliance partner \\ competing with these firms in a centralized location to pay percentage! Proprietary information in a particular ratio or not they have the potential to a! Between individuals when it is a way to bring together complementary skills and assets that neither could... Hold-Up Stefan and the driver of the following statements is true of strategic?! 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Coffee chains, combine resources to enter the global market choose to at. Two organizations, Purple Inc. and Plateus Inc. formed an alliance to benefit from complementary activities inadvertently a... B. Misrepresentation true False False an alliance is an agreement between two to. The company is willing to pay a percentage of revenue to the Equator 75/25 which of the is...