Which of the Following Is Not True of Licensing

question 19

Multiple Choice

Which of the following is not true of licensing?

• A) Licensing allows a firm to purchase the right to manufacture and sell another firm's products within a specific country or set of countries.
• B) The licensor is normally paid a royalty on each unit sold.
• C) Licensors have considerable control the manufacturing and marketing of their products marketed in foreign countries.
• D) The licensee takes the risks and makes the investments in facilities for manufacturing, marketing and distribution of goods and services.
• E) Licensing is an increasingly popular entry mode for smaller firms with insufficient capital and limited brand recognition.

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Definitions:

Social Learning

A theory that suggests people learn new behaviors and acquire new information by observing and mimicking others, as well as through direct instruction.

Cognitive Dissonance

The mental discomfort experienced by a person who holds two or more contradictory beliefs, ideas, or values at the same time, leading to an alteration in one of the attitudes, beliefs, or behaviors to reduce the discomfort and restore balance.

Competitive Inertia

A situation where a company continues with its current strategies because it has historically been successful, even when those strategies become less effective.

Affect

A term referring to the experience of feeling or emotion in psychology.