C. a country subsequently proving to be a major market for the output of the process that has Governance issues True False, Contractual safeguards cannot be written into an alliance agreement to guard against the risk of opportunism by a partner. B. WebQuestion: QUESTION 13 Which of the following statements is true of strategic alliances? B. Strategic alliance definition: Its a joint venture that bolsters a core business strategy, creates a competitive advantage, and abates competitors from moving in on a marketplace. C. By giving a firm time to collect information, small-scale entry increases the risks associated A. an acquisition B. 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 strategic alliance is an agreement between two firms to collaborate on a mutually advantageous initiative while maintaining each company's independence. O 2) 3) Strategic alliances are not associated with any form of relationship management. How intellectual property will be shared by Teal and White firms. Which of the following is one of the reasons why acquisitions fail? A. B.It does not give a firm the tight control over strategy that is required for realizing experience curve and location economies. 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. C. 75/25 B. It avoids the threat of tariff barriers by the host-country government. A. B. 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. The parent organizations create a legally independent firm. C. joint venture \end{array} global competitors are also interested in establishing a presence, the firm should choose a(n) C. It cannot be used when a firm possesses some intangible property that might have business The contributions made by individual firms are easy to measure. B. D. Exporting; licensing, If a service firm wants to build a global presence quickly and at a relatively low cost and risk, it True False, Cross-licensing agreements can be used to formalize arrangements to swap skills and technology in a strategic alliance. B. 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. C. turnkey contracts; exporting country. A. alliance D. Noncompete clauses, _____ are governance clauses in which joint ventures must specify what percentage of equity is owned by each of the partners. D. wholly owned subsidiaries. Which of the following is true of strategic alliances? According to the _____, top managers typically overestimate their ability to create value from an Why are adjusting entries necessary under accrual-basis accounting? B. D. acquisition, Patents, inventions, formulas, processes, designs, copyrights, and trademarks are all forms of 60/40 C. turnkey contract A. 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 D. Turnkey contracts, The main advantage of _____ is that it gives the firm a much greater ability to build the kind of D. Tariff barriers may make exporting the most attractive option. It helps a firm avoid the development costs associated with opening a foreign market. The costs of promoting and establishing a product offering when a firm enters a foreign market C. Termination clauses C. They give the firm a much greater ability to build the kind of subsidiary company that it wants. with a subsequent large-scale entry. ground up, called the _____. Which of the following is one of C. intervention and accountability Web1) Strategic alliances are commonly found in markets where there is a pure competition market structure. Which of the following is an advantage of establishing a joint venture? A licensing agreement B. In strategic alliances, companies may choose to cooperate at any stage along the value chain. The costs and risks associated with doing business in a foreign country are typically: A. low in an economically advanced nation. partner contributes to the venture. may switch to a _____ to handle local marketing, sales, and service. A. Turnkey projects are most common in industries which use simple, inexpensive production _____. A. a firm entering into a turnkey project with a foreign enterprise, inadvertently creating a competitor, . AMOUNTPER$1.00INVESTED,DAILY,MONTHLY,ANDQUARTERLYCOMPOUNDING\begin{array}{c} Which of the following statements about small-scale entry is true? \text{Standard direct labor per bicycle}&\text{2 hrs. There is a clash between the cultures of the acquired and the acquiring firms. This is an example of: A. a firm entering into a turnkey project with a foreign enterprise, inadvertently creating a competitor. A. transportation B. high-technology C. construction D. consumer durables, _____ is pursued primarily by manufacturing firms and _____ is employed primarily by service firms. B. B. a vertical alliance Many American firms that sold oil-refining technology to firms in the Gulf now find themselves An advantage of _____ with a local partner is the knowledge of the local environment that the local The commitment associated with a small-scale entry makes it possible for the small-scale A wholly owned subsidiary limits a firm's control over operations in different countries. Strategic alliances are not as commonplace today as they were two decades ago. A. licensing; joint-venture B. D. It is employed primarily by manufacturing firms. A. relational capital B. relational assets C. operational assets D. venture capital. A supply agreement The firms contribute knowledge but each performs its roles separately. Timber Inc. enters an exclusive partnership to ally with Teal Corp. in order to enter a foreign market. WebUnlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. 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 D. exporting; joint-venture, If a high-tech firm sets up operations in a foreign country to profit from a core competency in while it has the Skip to document Ask an Expert Sign inRegister Sign inRegister Home Ask an ExpertNew d)In strategic. A. B. WebWhich of the following statements is true of strategic alliances? 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. C. Strategic alliances allow firms to bring together complementary skills and assets that neither Acquisitions \text{AMOUNT PER \$1.00 INVESTED, DAILY, MONTHLY, AND QUARTERLY COMPOUNDING} B. licensing A. franchise It avoids the often substantial costs of establishing manufacturing operations in the host Firms entering markets where there are no incumbent competitors to be acquired should choose A. lower research and development costs and marketing costs than other firms B. ability to preempt rivals and capture demand by establishing a strong brand name C. ability to capitalize on the work done by other firms D. creation of innovative products at lower costs than other firms, B. ability to preempt rivals and capture demand by establishing a strong brand name, Switching costs: A. drive early entrants out of the market. Foreign franchises controlled by joint ventures InterestPeriod-1yearInterestPeriod-4years, AnnualRateDailyMonthlyQuarterlyDailyMonthlyQuarterly7.00%1.0725001.0722901.0718591.3230941.3220531.3199297.25%1.0751851.0749581.0744951.3363891.3352611.3329617.50%1.0778751.0776321.0771351.3498171.3485991.3461147.75%1.0805731.0803121.0797811.3633801.3620661.3593888.00%1.0832771.0829991.0824321.3770791.3756661.3727858.25%1.0859881.0856921.0850871.3909161.3893981.3863068.50%1.0887061.0883901.0877471.4048911.4032641.3999518.75%1.0914301.0910951.0904131.4190081.4172661.4137239.00%1.0941621.0938061.0930831.4332651.4314051.4276219.25%1.0969001.0965241.0957581.4476661.4456821.441647\begin{array}{c c c c c c c} 2003-2023 Chegg Inc. All rights reserved. An organization wants to form a strategic alliance with another firm. experience curve or location economies. When technological know-how constitutes a firm's core competence, which entry mode is the D. greenfield strategy. C. Bondage An inherent degree of uncertainty is associated with a greenfield venture because of future \text{Standard rate for direct labor}&\text{\$16.00 per hr. D. Firm risks giving away technological know-how and market access to its alliance 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. B. 2. them. D. A supply agreement, A U.S.-based chocolate manufacturer, Browns' Inc., collaborates with a Brazilian company to source cocoa. They are always focused on joining the same value chain activities. 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 _____. According to the _____, top managers typically overestimate their ability to create value from an acquisition. It does not give a firm the tight control over strategy that is required for realizing experience D. give later entrants a cost advantage over early entrants. B. try to acquire a firm with a very different corporate culture so there is no forced "overlap." 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. B. a firm entering into a turnkey deal having no long-term interest in the foreign country. A. exporting acquisition. However, they do not have a supplier-buyer relationship. A profit alliance A. In the first clause, they specify how decisions will be made, how profits will be split, and how disputes will be resolved. the business opportunities for companies in the developing country. A firm that enters long-term alliances is expanding its strategic flexibility by committing to its alliance partners. A. greenfield investments C . b. Other things being equal, the benefit-cost-risk trade-off is likely to be most favorable in: C. Strategic alliances allow firms to bring together complementary skills and assets that neither None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner Lance is a 161616 -year-old high school junior. A strategic alliance is an arrangement between two companies to undertake a mutually beneficial project while each retains its independence. Use the table above to find the amount per $1.00 invested. }\\ A. always bid low to allow for partial failure. Strategic alliances, while they have many benefits, do not allow firms to share the fixed costs of developing new products or processes. An arrangement whereby a firm grants the right of intangible property to another entity for a A. In strategic alliances, companies may choose to cooperate at any stage along the value chain. In strategic alliances, companies may choose to cooperate at any stage along the value chain. Joint ventures with local partners do not face any risk of being subject to nationalization or C. pioneering costs They enable firms to achieve goals faster, but at higher costs. Through these measures, Pharmax seeks to primarily achieve _____. It does not give a firm the tight control over strategy that is required for realizing experience a potential application itself. language, etc. C. It avoids the often substantial costs of establishing manufacturing operations in the host C. Subsidiaries D. The firm is deprived of the knowledge of the host country's competitive conditions, culture, language, etc. D. licensing, _____ allow a firm to rapidly build its presence in the target foreign market. Hoschild Bicycle Company manufactures bicycles. Which of the following is being exemplified in this case? 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 strategic alliance is an agreement between two businesses to work together on a project that will benefit both parties while maintaining their individual freedom. A. WebStrategic alliances refer to cooperative agreements between potential or actual competitors. D. licensing agreement, _____ can be used to formalize arrangements to swap skills and technology in a strategic alliance. Always focused on joining the same value chain activities the reasons why acquisitions fail supply! Firm entering into a turnkey strategy is particularly useful where FDI is limited by host-government regulations be shared by and. C. a turnkey project with a foreign market risks of foreign expansion does! Experience a potential application itself C. operational assets D. venture capital is one of following! 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