Imperfections in the Market for Intangible Assets Can Also Play

question 47

Multiple Choice

Imperfections in the market for intangible assets can also play a major role in motivating firms to undertake cross-border acquisitions. According to the internalization theory,

• A)cross-border acquisitions may also be motivated by the acquirer's desire to acquire and internalize the target firm's intangible assets.
• B)a firm with intangible assets that have a public good property such as technical and managerial know-how may acquire foreign firms as a platform for using its special assets on a larger scale and, at the same time, avoid the misappropriation that may occur while transacting in foreign markets through a market mechanism.
• C)the internalization thus may proceed forward to internalize the acquirer's assets, or backward to internalize the target's assets.
• D)all of the above

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Definitions:

Gun Sales

The commercial activity involving the buying and selling of firearms.

Agenda Setting

The ability of the media to focus attention on particular events or topics, thereby influencing public perception and priorities.

Social Networking

The use of internet-based platforms and applications that enable users to interact, share information, and build communities or networks.

Blogging

The activity of writing or maintaining a blog, which is a regularly updated website or web page, typically run by an individual or small group, that is written in an informal or conversational style.