Derrido Is an American Firm That Has Produced Several Successful

question 169

Multiple Choice

Derrido is an American firm that has produced several successful animated TV series in the United States. It is considering contracting with one or more international companies as a way to market its products overseas. Derrido's marketing director thinks that the company should craft a contractual agreement as an initial entry strategy, because the company might want to choose a more advanced entry strategy later. Which of the following, if true, would strengthen this position?

• A) Foreign partners usually want to enter into contractual agreements with American companies for a long-term period.
• B) A contractual agreement should spell out as many expectations of the foreign partner as possible.
• C) Contractual agreements should be entered into only if the foreign partner is extremely reliable.
• D) Contractual agreements require approval by legal specialists from all countries involved.
• E) Contractual agreements allow a company to provide for open, flexible terms of operation.

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Definitions:

Equilibrium Price

The equilibrium price where the supply of goods meets the demand for those goods in the marketplace.

Equilibrium Quantity

The quantity of goods or services supplied that is equal to the quantity demanded at the market price.

Simultaneous Decrease

A situation where two or more economic variables or quantities decline at the same time.

Demand Curve

The Demand Curve is a graphical representation showing the relationship between the price of a good or service and the quantity demanded by consumers, typically downward sloping.