What Is the Primary Advantage of Licensing

question 28

Multiple Choice

What is the primary advantage of licensing?

• A) It helps a firm avoid the development costs and risks associated with opening a foreign market.
• B) It gives a firm the tight control over manufacturing, marketing, and strategy.
• C) It helps a firm achieve experience curve and location economies.
• D) It increases a firm's ability to utilize a coordinated strategy.

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Definitions:

Cost of Goods Sold

Direct costs attributable to the production of goods sold by a company, including materials and labor costs.

Inventory Purchases

Transactions involving buying products or raw materials for the purpose of resale or production.

Merchandise

Goods that are purchased, stored, and then sold by retailers or wholesalers, typically in the context of inventory for sale.

Cash Disbursements

Payments made by a business in cash, including expenses, debt payments, and distributions to shareholders.