When Entering a Foreign Market, It Is Advisable for a New

question 77

Multiple Choice

When entering a foreign market, it is advisable for a new venture that has a core competency only in R&D to form a strategic alliance with a local partner because

• A) the local partner can better protect its proprietary know-how.
• B) building downstream complementary assets can be expensive and time-consuming.
• C) the strategic alliance will reduce the differentiation of its product and service offerings.
• D) the value gap created by the firm can be easily lowered in an alliance.

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Definitions:

Original Obligor

The individual or entity originally responsible for fulfilling the obligations of a contract or agreement.

Obligee

The party in a contractual agreement who is entitled to receive a performance or benefit from the obligor.

Express Consent

Clear and voluntary permission given by a person or party to another for a specific action or procedure, often communicated orally or in writing.

Noncompetition Provision

A clause in a contract that prohibits an individual from entering into or starting a similar profession or trade in competition against another party, typically an employer, for a certain period of time and within a specific geographic area.