Your Company Is Interested in Producing and Marketing a Line

question 8

Multiple Choice

Your company is interested in producing and marketing a line of coffee that will penetrate the Chinese market. Your firm is willing to supply the equipment, products, product ingredients, trademark, and standardized operating system. What type of strategy are you going to use?

• A) Wholly owned foreign affiliate
• B) A greenfield venture agreement
• C) A franchise
• D) An export agreement
• E) Barter trade

---

Definitions:

Variable Cost

Expenses that vary depending on the amount of products or services a company generates.

Contribution

The amount of money or resources that an individual or entity provides towards a particular project, investment, or cause.

Operating Leverage

A measure of how revenue growth translates into growth in operating income, indicating the proportion of fixed to variable costs.

Fixed Costs

Costs that do not fluctuate with changes in production level or sales volume, such as rent, salaries, and insurance.