A Joint Venture Is an Attractive Way for a Company

question 93

Multiple Choice

A joint venture is an attractive way for a company to enter a new industry when

• A) a firm is missing some essential skills or capabilities or resources and needs a partner to supply the missing expertise and competencies or fill the resource gaps.
• B) it needs access to economies of scope and good financial fits in order to be cost-competitive.
• C) it is uneconomical for the firm to achieve economies of scope on its own initiative.
• D) the firm has no prior experience with diversification.
• E) it has not built up a hoard of cash with which to finance a diversification effort.

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Definitions:

Promotion

A marketing strategy involving the publicizing of a product, service, or brand to attract interest, engagement, and sales.

Intangibility

A characteristic of services that makes them unable to be seen, touched, tasted, felt, or measured in the same manner as physical goods.

Inseparability

A characteristic of service marketing that indicates the simultaneous production and consumption of a service, implying that services cannot be separated from their providers.

Services

Intangible and non-physical goods provided to consumers, including activities, benefits, or satisfactions offered for sale.