Which of the Following Is NOT a Disadvantage of Licensing

question 63

Multiple Choice

Which of the following is NOT a disadvantage of licensing?

• A) Little control over the marketing of the products
• B) Licensees may develop a competitive product after the license expires
• C) Decreased potential returns
• D) The high costs of establishing manufacturing facilities

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Definitions:

Risk-Free Asset

An investment with a guaranteed return and no risk of loss, often exemplified by government bonds of stable countries.

Risky Asset

An investment that holds some risk of losing value, as opposed to a guaranteed or risk-free asset, offering potentially higher rewards in exchange for higher risk.

Expected Return

The weighted average of the probable returns of an investment, where the weights correspond to the probability of each outcome.

Standard Deviation

A metric that quantifies the spread of a dataset around its mean, determined by taking the square root of the variance.