Which of the Following Is an Advantage of Management Contracting

question 5

Multiple Choice

Which of the following is an advantage of management contracting?

• A) It involves the least change in a company's product lines.
• B) It allows a contracting firm to set up its own operations at the beginning of the contract.
• C) It is the simplest way to enter a foreign market.
• D) It yields income from the beginning of the contract.
• E) It gives a contracting firm an option to buy shares in the managed company immediately.

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Definitions:

Externality

A term in economics that describes a cost or benefit that affects a party who did not choose to incur that cost or benefit.

Internality-Externality

A psychological dimension that distinguishes between individuals who attribute outcomes to their own control (internality) and those who attribute them to external forces (externality).

Locus of Control

Locus of control is a psychological concept that refers to individuals' belief about the extent to which the outcomes of their actions are under their own control (internal locus) or influenced by external factors (external locus).

Reinforcement Contingency

Reinforcement contingency is a term in behavioral psychology that refers to the relationship between a behavior and its consequence, emphasizing that a behavior must be followed by a reinforcement for the behavior to be increased.