Which of the Following Is True of Licensing as a Mode

question 21

Multiple Choice

Which of the following is true of licensing as a mode of entry into foreign markets?

• A) A licensor grants the rights to tangible property to a licensee.
• B) A licensing agreement grants rights to intangible property to a licensee for an unspecified period.
• C) The licensor receives a royalty fee from the licensee.
• D) The licensor puts up all of the capital necessary to start a business.
• E) The licensor maintains control over its technological know-how.

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Definitions:

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, detailing revenue and expenses to show net income or loss.

Revenues

The income generated from normal business operations and includes discounts and deductions for returned merchandise.

Expenses

Outflows of resources or incurrences of liabilities that result in a decrease in the equity of a company, other than distributions to owners.

Accounts Receivable

Money owed to a company by its customers for goods or services provided on credit.