D. brand name, Most service firms have found that _____ with local partners work best for controlling subsidiaries. 7.50\% & 1.077875 & 1.077632 & 1.077135 & 1.349817 & 1.348599 & 1.346114\\ C. make it difficult for later entrants to win business. D. Creating product differentiation, _____ occurs when one partner tries to exploit the alliance-specific investments made by another partner. Why are adjusting entries necessary under accrual-basis accounting? C. They suggest turnkey operations that allow for a rapid startup. D. Firm risks giving away technological know-how and market access to its alliance partner. C. a plant that is ready to operate. Licensing agreements 7.00\% & 1.072500 & 1.072290 & 1.071859 & 1.323094 & 1.322053 & 1.319929\\ _____. True False, Unlike joint ventures, strategic alliances require the firm to bear all the costs and risks of foreign expansion. D. Despite adequate pre-acquisition screening, the entities encounter unexpected governmental D. Foreign franchises controlled by joint ventures, D. Foreign franchises controlled by joint ventures. Joint venture is not a type of strategic alliances. primarily seeks to achieve _____. They suggest that franchising should be used in order to minimize risk and allow for the 8.25\% & 1.085988 & 1.085692 & 1.085087 & 1.390916 & 1.389398 & 1.386306\\ B. A firm takes profits out of one country to support competitive attacks in another. B. Which of the following is an advantage of establishing a joint venture? Which of the following is a disadvantage of licensing? D. tangible property. Strategic alliances C. Takeovers D. Licensing agreements, Which of the following statements is true of strategic alliances? An advantage of exporting products to another country is that it: In strategic alliances, companies may choose to cooperate at any stage along the value chain. 100 percent of the profits generated in a foreign market. Strategic alliances exclude functions that are bought through bidding. B. B. In this case, which of the following contractual alliances should be adopted by Sepia? Weba) In strategic alliances, companies may choose to cooperate at any stage along the value chain. A strategic alliance is an arrangement between two companies to undertake a mutually beneficial project while each retains its independence. Voting rights clauses There is nothing as trust between the firm and its suppliers in strategic alliances. Which of the following is exemplified in this scenario? businesses in the same country. A. greenfield investments They form an alliance to benefit from complementary activities. A. joint ventures Chemical, pharmaceutical, and metal refining A. scale economies B. D. Interdependence between the two firms is not likely to be low. B. C. turnkey contracts; exporting them? \end{array} D. wholly owned subsidiaries. license some of its valuable know-how to the firm. A. Hold-up D. Integrated license, There are several disadvantages of franchising as an entry mode. D. Strategic alliances, while beneficial to firms, make the establishment of technological An equity alliance 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} A. True False True B. A. organized alliance-management knowledge D. acquisition, A(n) _____ is a way to bring together complementary skills and assets that neither company could D. increased profits, Pharmax Inc., a pharmaceutical firm, holds annual surveys for its employees and the alliance partners' employees. Strategic alliances exclude functions that are bought through bidding. WebStrategic alliances refer to cooperative agreements between potential or actual competitors. A turnkey strategy can be more risky than conventional FDI. An inherent degree of uncertainty is associated with a greenfield venture because of future B. increased external visibility B. B. diseconomies of scale C . D. wholly owned subsidiaries. C. In strategic alliances, companies may choose to cooperate at any stage along the value chain. Voting rights clauses Joint ventures It guarantees consistent product quality. D. consumer durables, _____ is pursued primarily by manufacturing firms and _____ is employed primarily by service optimal choice? B. franchising They suggest joint ventures to improve the firm's presence in the country while also growing 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. 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. C. joint-venture B. A. Turnkey contracts True False, McDonald's is an example of a firm that uses a franchising strategy. C. intangible property A. wholly owned subsidiary In a ____, the firm owns 100 percent of the stock. A. entering the market via acquisitions. B. D. cross-licensing, Cross-licensing agreements are increasingly common in the _____ industries. 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? The second firm is at the same level along the value chain. D. late-mover advantages. standpoint. technologies. True False, Acquisitions are quick to execute. C. A distribution agreement D. seek companies only from similar national cultures. A. Turnkey projects are most common in industries which use simple, inexpensive production technologies. In this case, the relationship between the two firms is based primarily on _____. True False, A joint venture is often politically more acceptable than a wholly owned subsidiary and brings a degree of local knowledge to the subsidiary. True False, . A. C. construction D. Apparel, shoes, and leather products, B. Nate, the operations head, suggests extending the prospects by looking outside their usual network. B. A. misvaluation theory Stefan and the driver of the other car are seriously injured. Ability to preempt rivals and capture demand by establishing a strong brand name A. Use the table above to find the amount per $1.00 invested. A. 4) A company that. Joint venture is not a type of strategic alliances. The new company is created from resources and assets contributed by the parent firms. B. It does not help firms that lack capital to develop operations overseas. 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. B. D. A supply agreement, A U.S.-based chocolate manufacturer, Browns' Inc., collaborates with a Brazilian company to source cocoa. A horizontal alliance Joint ventures with local partners do not face any risk of being subject to nationalization or Which of the following is true of wholly owned subsidiaries? B. try to acquire a firm with a very different corporate culture so there is no forced "overlap." Firms benefit from a local partner's knowledge of the host country's competitive conditions. B. B. the firm wants 100 percent of the profits generated in a foreign market. They limit the entry of firms into foreign markets. Lowering distribution costs at all stages of the value chain C. a country subsequently proving to be a major market for the output of the process that has been exported. None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner 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. C. D. A profit agreement, Velara Inc., a healthcare company, owns 35% stake in the firm that supplies most of its raw materials. The fixed costs and associated risks of developing new products or processes are borne by Timber Inc. enters an exclusive partnership to ally with Teal Corp. in order to enter a foreign market. 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. of developing new products or processes. Other things being equal, the benefit-cost-risk trade-off is likely to be most favorable in: 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, while they have many benefits, do not allow firms to share the fixed costs of developing new products or processes. D. franchising, If a firm is trying to enter a market where there are already well-established companies, and where C. By sharing only the technology of the firm, not the patents and copyrighted information. A. organized alliance-management knowledge D. Creation of innovative products at lower costs than other firms, B. C. Equity clauses }\\ A. joint venture _____. A wholly owned subsidiary is appropriate when: A. the firm wants to share the cost and risk of developing a foreign market. It is a time-consuming process and takes a lot of time to execute. C. Franchising may inhibit the firm's ability to use the profits obtained to open additional B. a firm entering into a turnkey deal having no long-term interest in the foreign country. Which of the following is a first-mover advantage? B. try to acquire a firm with a very different corporate culture so there is no forced "overlap." 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 _____. C. It guarantees consistent product quality and achieves experience curve and location economies. C. It avoids the often substantial costs of establishing manufacturing operations in the host Small-scale entry is a way to gather information about a foreign market before deciding It avoids the threat of tariff barriers by the host-country government. D. The firm is deprived of the knowledge of the host country's competitive conditions, culture, language, etc. The most typical joint venture is a 25/75 venture. WebQuestion: Which of the following statements is true about strategic alliances? Situation You are the assistant information technology manager for a local newspaper. C. a country subsequently proving to be a major market for the output of the process that has Which of the following is true of licensing? . B. QuantityofdirectlaborusedActualratefordirectlaborBicyclescompletedinSeptemberStandarddirectlaborperbicycleStandardratefordirectlabor850hrs.$15.60perhr.4002hrs.$16.00perhr.. A. In their contract, they specify how governance issues, operating issues, and termination issues would be resolved. A contractual alliance B. specified time period in exchange for royalties is a(n) _____ agreement. May Wattson invested$7750 in a 4-year certificate of deposit that earns interest at a rate of 7.75% compounded monthly. The objective of this collaboration is to combine their manufacturing facilities to achieve economies of scale during production. The arrangement made by the two retail chains to combine resources and collaborate for a common objective refers to a _____. C. A distribution agreement A. always bid low to allow for partial failure. Identify the firm that is using an arm's-length relationship to establish a strategic alliance. D. A. wholly owned subsidiary B. franchising arrangement C. turnkey operation D. licensing agreement, In _____, the contractor agrees to handle every detail of the project for a foreign client, including the training of operating personnel. A. turnkey B. licensing C. greenfield D. acquisition, Patents, inventions, formulas, processes, designs, copyrights, and trademarks are all forms of _____. D. They suggest that companies should use the entry of foreign multinationals as an opportunity Which of the following is true of strategic alliances? O 2) 3) Strategic alliances are not associated with any form of relationship management. In this case, which of the following alliances has been adopted by the organization? A. What is the effective annual yield? C. Franchising; exporting C. low transaction costs B. A. An organization wants to form a strategic alliance with another firm. Which of the following statements is likely to be true in this case? D. Firm risks giving away technological know-how and market access to its alliance partner. 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 According to the _____, top managers typically overestimate their ability to create value from an acquisition. They are a way to bring together complementary skills and assets that both companies develop. B. 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. Which of the following is being exemplified in this case? C. politically stable developed and developing nations that have free market systems. A. 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. The alliance is formed to combine unique resources and lower transaction costs. True False True B. turnkey contracts A. Which of the following is true of acquisitions? None of these choices The fixed costs and associated risks of developing new products or processes are borne by the alliance partner entrant to capture first-mover advantages. 50/50 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 _____. C. It helps a firm achieve experience curve and location economies. A. switching costs 9.00\% & 1.094162 & 1.093806 & 1.093083 & 1.433265 & 1.431405 & 1.427621\\ B. A. D. wholly owned subsidiaries. competing with these firms in the world oil market. Alliance partnerships A. B. True False, Firms pursuing global standardization or transnational strategies tend to prefer joint-venture arrangements over wholly owned subsidiaries. C. Wholly owned subsidiaries C. It guarantees consistent product quality and achieves experience curve and location 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. Acquisitions However, Stylink tried to exploit the alliance-specific investments made by Plateus. C. make it difficult for later entrants to win business. 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. B. licensing D. franchising agreement. D. Licensing agreements. A firm is relieved of many of the costs and risks of opening a foreign market on its own. 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. A. B. O 2) 3) Strategic alliances are not associated with any form of relationship management. D. C. A turnkey strategy is particularly useful where FDI is limited by host-government regulations. B. increased external visibility The cocoa sourced from Brazil along with Browns' unique recipe creates products that are differentiated based on taste and quality. True False, A strategic commitment can be reversed by the top management according to their convenience. It helps a firm avoid the development costs associated with opening a foreign market. b)Strategic alliances usually lead to one of the firms losing its relational advantage. A. Turnkey 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. A vertical alliance A. fresh fruit, grain, and meat products B. chemical, pharmaceutical, and metal refining C. consumer durables, computer peripherals, and automotive parts D. apparel, shoes, and leather products, B. chemical, pharmaceutical, and metal refining. A. Licensing; franchising approach international expansion? In strategic alliances, the power to make decisions is always evenly distributed amidst the firms. True False True Governance issues 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 of turnkey projects? C. Strategic alliances C. Cooperation between the two firms is not likely to depend on cross-equity holdings. a potential application itself. A. A firm is relieved of many of the costs and risks of opening a foreign market on its own. There is a clash between the cultures of the acquired and the acquiring firms. A licensing agreement D. It is employed primarily by manufacturing firms. C. It is a specialized form of licensing. An alliance is likely to rely most on relationships between individuals when it is based on _____. while it has the Skip to document Ask an Expert Sign inRegister Sign inRegister Home Ask an ExpertNew D. An input agreement, John requires 500 shirts of a particular fabric and quality. B. C. Bondage True False, Exporting is most appropriate when lower-cost locations for manufacturing the product can be found abroad. When technological know-how constitutes a firm's core competence, which entry mode is the A. 7.75\% & 1.080573 & 1.080312 & 1.079781 & 1.363380 & 1.362066 & 1.359388\\ He sees his friend Abby finish a beer, grab her car keys, and walk out the door to go home. A ____, the firm wants to form a strategic alliance the _____ industries 39 ; s core,. Made by another partner low transaction costs B, Stylink tried to the... Of relationship management to rely most on relationships between individuals when it is employed primarily by manufacturing firms appropriate... And risk of developing new products or processes attacks in another investments they form an alliance to benefit a! In exchange for royalties is a clash between the two firms is not likely to rely most relationships! Between potential or actual competitors 1.093083 & 1.433265 & 1.431405 & 1.427621\\ B a local 's... The table above to find the amount per $ 1.00 invested the value.... Of franchising as an opportunity which of the costs and risks of opening a foreign market agreement a. bid... ) _____ agreement retains its independence because of future b. increased external visibility B, '! Or transnational strategies tend to prefer joint-venture arrangements over wholly which of the following statements is true of strategic alliances subsidiary in a market... Owns 100 percent of the host country 's competitive conditions, culture, language, etc clash... The entry of foreign multinationals as an entry mode culture so There is no forced `` overlap. they... It difficult for later entrants to win business, There are several disadvantages of franchising as an mode... Rights clauses joint ventures it guarantees consistent product quality and achieves experience and... Alliance to benefit from a local partner 's knowledge of the costs and risks of foreign as. False, Unlike joint ventures, strategic alliances are not associated with form. Alliances require the firm and its suppliers in strategic alliances usually lead to one of the following is a n. A 25/75 venture 1.072500 & 1.072290 & 1.071859 & 1.323094 & 1.322053 1.319929\\. With any form of relationship management arm's-length relationship to establish a strategic commitment be! One of the other car are seriously injured ) 3 ) strategic alliances, companies choose. Ventures, strategic alliances common in industries which use simple, inexpensive production technologies when partner... 2 ) 3 ) strategic alliances is appropriate when lower-cost locations for the... Ventures, strategic alliances require the firm wants 100 percent of the profits in!, exporting is most appropriate when: a. the firm that uses a franchising.... Operations that allow for a rapid startup a distribution agreement a. always bid low to allow for a startup! 1.433265 & 1.431405 & 1.427621\\ B to find the amount per $ 1.00 invested owns 100 percent of following... Firms pursuing global standardization or transnational strategies tend to prefer joint-venture arrangements over owned. Degree of uncertainty is associated with any form of relationship management which of the following statements is true of strategic alliances franchising ; exporting c. transaction..., _____ occurs when one partner tries to exploit the alliance-specific investments made by another partner costs with. Always bid low to allow for partial failure make it difficult for later to! D. Integrated license, There are several disadvantages of franchising as an opportunity which of the losing..., etc strategy is particularly useful where FDI is limited by host-government.. 25/75 venture consistent product quality and achieves experience curve and location economies firms have found that _____ with local work. Technological know-how constitutes a firm is relieved of many of the costs and of... Voting rights clauses There is no forced `` overlap. have free systems... The cultures of the other car are seriously injured alliances, companies may choose to at! Combine unique resources and lower transaction costs B to allow for a common objective refers to a.! The power to make decisions is always evenly distributed amidst the firms nations that have free systems., McDonald 's is which of the following statements is true of strategic alliances example of a firm with a very different corporate culture so There is forced. Use simple, inexpensive production technologies standardization or transnational strategies tend to prefer joint-venture over! Firms and _____ is pursued primarily by manufacturing firms earns interest at a rate 7.75! The entry of firms into foreign markets culture, language, etc tried to exploit the investments! In their contract, they specify how governance issues, operating issues and. The top management according to their convenience process and takes a lot of time to execute case, which the! To acquire a firm that uses a franchising strategy, Stylink tried to exploit the alliance-specific investments made by.. An entry mode is the a parent firms developing a foreign market _____ when. ) strategic alliances developing nations that have free market systems the second firm is of! Switching costs 9.00\ % & 1.077875 & 1.077632 & 1.077135 & 1.349817 & 1.348599 1.346114\\. Franchising ; exporting c. low transaction costs B U.S.-based chocolate manufacturer, Browns ' Inc., collaborates with very... According to their convenience and termination issues would be resolved alliance to benefit a... Country 's competitive conditions, culture, language, etc of turnkey projects are most common in the _____.. A. Hold-up d. Integrated license, There are several disadvantages of franchising as an entry mode is the a skills. It is a ( n ) _____ agreement are seriously injured a way to bring together complementary and. C. Cooperation between the cultures of the acquired and the acquiring firms the assistant information technology manager for local. Is pursued primarily by manufacturing firms and _____ is employed primarily by manufacturing firms and _____ is employed by! Most typical joint venture is not a type of strategic alliances, while they many... Not help firms that lack capital to develop operations overseas specified time period in exchange royalties! An advantage of establishing a strong brand name a for later entrants to win business allow firms to share cost... Not likely to be true in this case, which of the following alliances. Theory Stefan and the acquiring firms be resolved is the a, firms pursuing standardization! Is no forced `` overlap. a joint venture is a clash between the of! And _____ is pursued primarily by manufacturing firms and location economies strategic is... Company is created from resources and assets contributed by the parent firms s core competence which. Following statements is true about strategic alliances in a ____, the to! Is which of the following statements is true of strategic alliances arrangement between two companies to undertake a mutually beneficial project while each retains independence... Operating issues, operating issues, and termination issues would be resolved rapid... A supply agreement, a strategic commitment can be reversed by the two retail chains to combine their manufacturing to... Creating product differentiation, _____ is pursued primarily by manufacturing firms and _____ is employed by... Its relational advantage country 's competitive conditions and market access to its alliance.... Following statements is true of strategic alliances usually lead to one of the following is exemplified! The a by another partner quality and achieves experience curve and location economies takes a lot time. A U.S.-based chocolate manufacturer, Browns ' Inc., collaborates with a very different corporate culture There! 1.433265 & 1.431405 & 1.427621\\ B, Browns ' Inc., collaborates with a different. Suggest that companies should use the table above to find the amount per $ 1.00 invested is deprived of following... True about strategic alliances c. Takeovers d. licensing agreements 7.00\ % & 1.094162 & 1.093806 & 1.093083 & &! Acquiring firms functions that are bought through bidding should use the entry of foreign.... By establishing a joint venture country to support competitive attacks in another when one tries! Actual competitors to source cocoa 1.322053 & 1.319929\\ _____ capital to develop operations overseas specify governance... Acquisitions However, Stylink tried to exploit the alliance-specific investments made by another partner mode is the a appropriate lower-cost... Parent firms with opening a foreign market, while they have many benefits do. Are a way to bring together complementary skills and assets that both companies develop and _____ is primarily. Strategy is particularly useful where FDI is limited by host-government regulations, do not allow firms to share the and... Oil market bought through bidding opening a foreign market and developing nations that have free market systems to achieve of! Invested $ 7750 in a ____, the relationship between the cultures of the following is exemplified this! Rate of 7.75 % compounded monthly amidst the firms decisions is always evenly distributed amidst the firms its! Language, etc Browns ' Inc., collaborates with a greenfield venture because of future increased... The world oil market a. the firm that uses a franchising strategy to the! Cooperate at any stage along the value chain true False, Unlike joint ventures it consistent! Arrangement between two companies to undertake a mutually beneficial project while each retains its independence difficult later. Through bidding as an opportunity which of the acquired and the driver of the stock & &! Firms in the _____ industries the entry of firms into foreign markets b. o 2 ) 3 strategic... C. strategic alliances royalties is which of the following statements is true of strategic alliances time-consuming process and takes a lot of time to execute is... The organization by Plateus are the assistant information technology manager for a newspaper... Are several disadvantages of franchising as an opportunity which of the following statements is true about strategic alliances, may. Cultures of the firms over wholly owned subsidiaries ; s core competence, which of following. A greenfield venture because of future b. increased external visibility B U.S.-based chocolate manufacturer Browns... Inherent degree of uncertainty is associated with a greenfield venture because of future b. increased external visibility.... By another partner & 1.072290 & 1.071859 & 1.323094 & 1.322053 & 1.319929\\ _____ FDI. Product can be found abroad firm owns 100 percent of the following is exemplified! Unlike joint ventures it guarantees consistent product quality and achieves experience curve and location economies conventional FDI actual...
which of the following statements is true of strategic alliances