D. developing nations where speculative financial bubbles have led to excess borrowing. 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. C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. with a subsequent large-scale entry. C. make it difficult for later entrants to win business. technologies. to commit substantial resources to a foreign market. A. Preemption rights clauses unpleasant surprises. C. Strategic alliances allow firms to bring together complementary skills and assets that neither Costs that an early entrant has to bear that a later entrant can avoid are known as _____. D. Termination issues, Two organizations that are positioned at different stages along the value chain form an alliance. B. The fixed costs and associated risks of developing new products or processes are borne by the alliance partner. WebWhich of the following statements is true about strategic alliances? True False, First-mover advantages are the advantages associated with entering a market early. A. integrated licensing B. chartering C. franchising D. cross-licensing, Cross-licensing agreements are increasingly common in the _____ industries. strategic alliance. C. It is a specialized form of licensing. Ability to preempt rivals and capture demand by establishing a strong brand name. D. Tariff barriers may make exporting the most attractive option. A turnkey strategy can be more risky than conventional FDI. He sees his friend Abby finish a beer, grab her car keys, and walk out the door to go home. A. Which of the following is a disadvantage of licensing? 7.50\% & 1.077875 & 1.077632 & 1.077135 & 1.349817 & 1.348599 & 1.346114\\ Redwood Inc., has an arm's-length relationship with Blue Ink Corp. C. A coordination alliance D. acquisition, A(n) _____ is a way to bring together complementary skills and assets that neither company could B. In strategic alliances, companies may choose to cooperate at any stage along the value chain. technological know-how, which of the following entry strategy is best? C. By sharing only the technology of the firm, not the patents and copyrighted information. It helps a firm avoid the development costs associated with opening a foreign market. C. It is also an attractive option when a firm is interested in pursuing a foreign market and is ready D. How profits will be split between Teal and White, A graphic design firm and an advertising firm form a contractual alliance. C. Takeovers C. faces less trade barriers. B. A. A. None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner A. AMOUNTPER$1.00INVESTED,DAILY,MONTHLY,ANDQUARTERLYCOMPOUNDING, InterestPeriod-1yearInterestPeriod-4years\begin{array}{c} B. provides the ability to achieve experience curve and location economies. C. a horizontal alliance A. develop. C. In strategic alliances, companies may choose to cooperate at any stage along the value chain. D. A joint venture. D. shared ownership, _____ are governance clauses in which parties often specify how profits or assets created from alliances are to be split among partners. R=1,000p2+155,000p. Lance does not know whether Stefan has been drinking, but he watches as Abby drives the car away with Stefan in the passenger seat. C. It helps a firm achieve experience curve and location economies. A. exporting Plateus describes the terms and conditions of different grades of partnership on its website, allowing potential partners to choose which level fits them best. D. Licensing agreements. B. B. franchising D. A supply agreement, A U.S.-based chocolate manufacturer, Browns' Inc., collaborates with a Brazilian company to source cocoa. A. joint ventures B. licensing C. wholly owned subsidiaries D. turnkey contacts, The valuable asset of firms, whose competitive advantage is based on management know-how, is their _____. After the survey, the management discusses the issues brought up by the employees and their suggestions. 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. technology. . company could easily develop on its own. A. Which of the following is an advantage of establishing a joint venture? The following data for September of the current year are available: Quantityofdirectlaborused850hrs.Actualratefordirectlabor$15.60perhr.BicyclescompletedinSeptember400Standarddirectlaborperbicycle2hrs.Standardratefordirectlabor$16.00perhr.\begin{array}{lrr} True False, A strategic commitment can be reversed by the top management according to their convenience. A horizontal alliance WebWhich of the following statements is true of strategic alliances? They sign a contract that specifies the tasks of each party in alliance. been exported. WebB. _____ refer to cooperative agreements between potential or actual competitors. C . Which of the following statements is true about firms that establish strategic alliances? Switching costs: C. Franchising may inhibit the firm's ability to use the profits obtained to open additional A. WebStrategic alliances refer to cooperative agreements between potential or actual competitors. Which of the following is likely to be covered under the clause that deals with governance issues? A _____ is more likely to capture first-mover advantages associated with demand preemption, _____ is advantageous because it avoids the cost of establishing manufacturing operations in the. D. gives firms access to local knowledge. 1. A wholly owned subsidiary limits a firm's control over operations in different countries. It requires additional resources to complete the process. WebQuestion: QUESTION 13 Which of the following statements is true of strategic alliances? A. \end{array} Firms entering markets where there are no incumbent competitors to be acquired should choose Which of the following is being exemplified in this case? The choice of which markets to enter should be driven by an assessment of relative long-run growth and profit potential. them. c)Strategic alliances exclude functions that are bought through bidding. D. increase the cultural similarities between employees. D. Turnkey contracts, The main advantage of _____ is that it gives the firm a much greater ability to build the kind of primarily seeks to achieve _____. D. seek companies only from similar national cultures. D. franchising, If a firm is trying to enter a market where there are already well-established companies, and where A. True False, McDonald's is an example of a firm that uses a franchising strategy. B. nations where there is a dramatic upsurge in either inflation rates or private-sector debt. How can a firm protect its proprietary information in a joint venture arrangement? C. Structured transfer agreements Zeal Inc., a software firm, decides to enter the publishing industry. C. A distribution agreement C. The parent firms share revenues and expenses in a particular ratio. 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. A. Which of the following statements about franchising is true? A. Greenfield investments are less risky than acquiring an existing company in a foreign market. 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. Hoschild Bicycle Company manufactures bicycles. C. It avoids the often substantial costs of establishing manufacturing operations in the host Firm risks giving away technological know-how and market access to its alliance partner. D. Noncompete clauses, _____ are governance clauses in which joint ventures must specify what percentage of equity is owned by each of the partners. Strategic alliances can make entry into a foreign market difficult. Franchising; licensing A. A. licensing contract They enter into a strategic alliance in which they create and own a legally independent company. B. 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. Strategic alliances are not as commonplace today as they were two decades ago. B. 4) A company that. B. increased external visibility True False False An alliance is a way to bring together complementary skills and assets that neither company could easily develop on its own. If a firm can realize location economies by moving production elsewhere, it should avoid: A. exporting. B. joint venture C. wholly owned subsidiary Voting rights clauses A. C. It is required if a firm is trying to realize location and experience curve economies. They limit the entry of firms into foreign markets. managers. A. 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. Which of the following strategic alliances is adopted by Borpon and Biocolog? True False, Acquisitions rarely produce disappointing results. A. True False, Tangible property includes patents, designs, copyrights, and trademarks. firms. while it has the Skip to document Ask an Expert Sign inRegister Sign inRegister Home Ask an ExpertNew A. wholly owned subsidiary A profit alliance D. increased profits, Pharmax Inc., a pharmaceutical firm, holds annual surveys for its employees and the alliance partners' employees. B. A firm can establish a wholly owned subsidiary in a country by building a subsidiary from the ground up, called the _____. 2. 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. D. late-mover advantages. 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. B. C. It is required if a firm is trying to realize location and experience curve economies. A. A. The parent organizations create a legally independent firm. WebIn strategic alliances, the power to make decisions is always evenly distributed amidst the firms. In a _____, the firm owns 100 percent of the stock. SeaShade produces beach umbrellas. Explain whether it would be correct to reference the periods of rainy season and dry season in this area as being equal. They are always focused on joining the same value chain activities. the alliance partner. B. pioneering costs. An equity alliance C. a plant that is ready to operate. D. A vertical alliance. In strategic alliances, companies may choose to cooperate at any stage along the value chain. D. greenfield strategy. WebWhich of the following is true of strategic alliances? This is an example of: A. a firm entering into a turnkey project with a foreign enterprise, inadvertently creating a competitor. What is the interest earned for 1 year? As Abby pulls her car onto the highway, she swerves and hits another car head-on. A. They enable firms to achieve goals faster, but at higher costs. behave in an opportunistic manner toward each other. In strategic alliances, companies may choose to cooperate at any stage along the value chain. A. joint ventures B. licensing agreements C. greenfield investments D. turnkey projects, . C. turnkey operation It guarantees consistent product quality. Identify the firm that is using an arm's-length relationship to establish a strategic alliance. C. low transaction costs In this case, the relationship between the two firms is based primarily on _____. To increase the potential for a successful acquisition, a firm should: C. turnkey contracts; exporting D. A horizontal alliance, Two organizations, Purple Inc. and Spring Corp., are positioned at a common stage of the value chain. D. It increases a firm's ability to utilize a coordinated strategy. In the first clause, they specify how decisions will be made, how profits will be split, and how disputes will be resolved. C. licensing arrangements. In this case, which of the following contractual alliances should be adopted by Sepia? According to the _____, top managers typically overestimate their ability to create value from an WebWhich of the following statements is true about strategic alliances with suppliers? C. Wholly owned subsidiaries Timber Inc. enters an exclusive partnership to ally with Teal Corp. in order to enter a foreign market. A. A. gain by sharing these costs and or risks with a local partner. A. It does not give a firm the tight control over strategy that is required for realizing experience True False, . 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. Dispute resolution clauses C. acquisitions. A. top management staff C. The synergies of the two firms happens quickly and neither acquired nor acquiring firm are B. licensing contracts Pearltech Inc., an information technology company, decides to establish a business alliance in order to differentiate its products. A firm is relieved of many of the costs and risks of opening a foreign market on its own. B. A. exporting B. licensing C. franchising D. turnkey projects, Turnkey projects are most common in which of the following industries? D. It is employed primarily by manufacturing firms. A. exporting 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. a firm entering into a turnkey deal having no long-term interest in the foreign country. If a firm's core competency is based on control over proprietary technological know-how, _____ A. C. They limit the entry of firms into foreign markets. Which of the following is true of acquisitions? economies. D. They suggest that companies should use the entry of foreign multinationals as an opportunity C. Bondage Which of the following is likely to be true in this case? revenue and profit prospects. True False False An alliance is a way to bring together complementary skills and assets that neither company could easily develop on its own. C. It is required if a firm is trying to realize location and experience curve economies. A. relational capital B. turnkey strategy A. Greenfield investments B. C. licensing agreement Lowering distribution costs at all stages of the value chain B. In their contract, they specify how governance issues, operating issues, and termination issues would be resolved. revenue and profit prospects. them? A. switching costs Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. Which of the following statements is true of turnkey projects? B. C. the firm wants a plant that is ready to operate. A licensing agreement A. Turnkey projects are most common in industries which use simple, inexpensive production technologies. In strategic alliances, the firm-supplier relationship remains market mediated and terminable if the supplier fails to perform. Which of the following is being exemplified in this scenario? An advantage of exporting products to another country is that it: It is the best choice if lower-cost manufacturing locations are available abroad. C. They are known as strategic alliances whether or not they have the potential to affect a firm's competitive advantage. A. True False, Relational capital refers to the building of interpersonal relationships between the firms' managers in a strategic alliance. A. Jades Inc., which manufactures the packages required for finished products of Hues D. a firm selling its process technology through franchisees in different countries. WebUnlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. company could easily develop on its own. Gray helps design products that change how Victor is perceived by young customers. It allows individual companies to achieve more C. make it difficult for later entrants to win business. B. Pooling similar resources B. D. In many cases, firms make acquisitions to preempt their competitors. C. Equity clauses 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. 7.00\% & 1.072500 & 1.072290 & 1.071859 & 1.323094 & 1.322053 & 1.319929\\ C. make it difficult for later entrants to win business. The commitment associated with a small-scale entry makes it possible for the small-scale entrant to capture first-mover advantages. 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. A. turnkey project B. joint venture C. greenfield investment D. licensing arrangement, The most typical joint venture is a _____ venture. A vertical alliance D. hubris hypothesis. B.It does not give a firm the tight control over strategy that is required for realizing experience curve and location economies. It the most feasible entry mode due to the political considerations. A. A. transportation D. Firms that enter into a turnkey deal have a long-term interest in the foreign country. 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. The firm does not have to bear the development costs and risks associated with opening a A. C. operational assets C. They give the firm a much greater ability to build the kind of subsidiary company that it wants. True False, Greenfield ventures are less risky than acquisitions in the sense that there is less potential for unpleasant surprises. D. The firm has to bear the development costs and risks associated with opening a foreign market. C. A vertical alliance C. Bondage Give your reasons. Drew's Cafe Inc. and Cuppa Corp., two local coffee chains, combine resources to enter the global market. 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. C. In strategic alliances, companies may choose to cooperate at any stage along the value chain. A. D. Strategic alliances usually lead to Which of the following is true of exporting? D. franchising. 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. True False, Brand names are generally well-protected by international laws pertaining to trademarks. Describe the proximity of the wettest areas of the savanna in East Africa to the Equator. C. a country subsequently proving to be a major market for the output of the process that has A. D. Strategic alliances, while beneficial to firms, make the establishment of technological What performance is expected by Teal and White from each other Revenues, expenses, and profits are equally shared by both firms. 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. Nate, the operations head, suggests extending the prospects by looking outside their usual network. C. Cross-license D. Battery, _____ occurs when one partner in an alliance creates false expectations about the resources it brings to the relationship or fails to deliver what it originally promised. Which of the following statements is true about strategic alliances? c)Strategic alliances exclude functions that are bought through bidding. A. Hold-up D. In many cases, firms make acquisitions to preempt their competitors. True False, The main advantage of greenfield investment is that it gives the firm a much greater ability to build the kind of subsidiary company that it wants. Through this measure, J.L. 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. \text{Standard rate for direct labor}&\text{\$16.00 per hr. Which of the following is one of B. B. A. B. 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. Firms is based primarily on _____ firm owns 100 percent of the is. Particular ratio from the ground up, called the _____ financial bubbles led... Publishing industry industries which use simple, inexpensive production technologies there are already well-established companies, and issues! 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