When a Firm Perceives Its Technological Advantage to Be Only

question 44

Multiple Choice

When a firm perceives its technological advantage to be only transitory,when it expects rapid imitation of its core technology by competitors,it might want to:

• A)revert to old technologies.
• B)engage in exporting on a large scale.
• C)license its technology as rapidly as possible to foreign firms.
• D)set-up a wholly owned subsidiary.

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Definitions:

Divestitures

Refers to the process of a company selling off or liquidating parts of its business or assets.

IFRS

International Financial Reporting Standards, a set of international accounting standards stating how particular types of transactions and other events should be reported in financial statements.

Bank Overdrafts

An extension of credit from a lending institution when an account reaches zero, allowing the account holder to continue withdrawing money up to a certain limit.

Indirect Method

A way of reporting cash flows from operating activities by starting with net income and adjusting for non-cash transactions.