For Most Consumer Services Firms, the Mode of Entry into a Foreign

question 48

Multiple Choice

For most consumer services firms, the mode of entry into a foreign market is licensing, franchising, strategic alliances, or direct. This is usually done because

• A) services are highly differentiated.
• B) services produced cannot be added to inventory.
• C) the creation and consumption of services cannot be separated.
• D) the inputs used vary to a great extent.
• E) services usually do not have any intrinsic value that can be converted into a tangible form.

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Definitions:

Shareholder's Agreement

A contract among the shareholders of a company outlining their rights, responsibilities, and obligations.

Voting Rights

The entitlement of individuals to participate in the election of government officials and to have their vote counted.

Pre-incorporation Contracts

Agreements entered into on behalf of a corporation that has not yet been legally formed, often leading to questions about enforceability.

Ratification

When the majority agrees with the terms of a collective bargain; when a principal confirms a contract entered into by his agent.