Which of the Following Is an Advantage of Licensing as a Mode

question 50

Multiple Choice

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

• A) It helps a firm to realize substantial experience curve and location economies.
• B) It gives the firm tight control over manufacturing, marketing, and strategy.
• C) The licensor does not have to bear the development costs and risks associated with opening a foreign market.
• D) Firms can easily maintain control over how their technological know-how is used by a licensee.
• E) Licensing allows a foreign firm to use profits earned in one country to support competitive attacks in another.

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Definitions:

Consumer Income

represents the total earnings received by consumers, including wages, salaries, benefits, and income from investments, influencing their purchasing power.

Soybean

A leguminous plant widely grown for its edible beans which are rich in protein and oil.

Alternative Crops

Crops that are not the usual cash crops in a region, often introduced for diversification and risk reduction in agriculture.

Supply Curve

A graphical representation showing the relationship between the price of a good or service and the quantity of that good or service that suppliers are willing to produce and sell.