According to the Internalization Theory,all of the Following Are Drawbacks

question 67

Multiple Choice

According to the internalization theory,all of the following are drawbacks of licensing as a strategy for exploiting foreign market opportunities except:

• A)licensing does not grant control over manufacturing,marketing,and strategy is granted to a licensee in return for a royalty fee.
• B)licensing may result in a firm's giving away its know-how to a potential foreign competitor.
• C)licensing does not give the firm the tight control over manufacturing,marketing,and strategy that may be required to profitably exploit its advantage.
• D)a firm's capabilities such as management,marketing,and manufacturing are often not amenable to licensing.

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Definitions:

Optimal Level

The most efficient, effective, or desirable point or state for a specific goal or condition, often in economic and operational contexts.

Market Supply Curve

Represents the total quantity of a good or service that all producers in a market are willing to sell at different price levels, at a given time.

Shift

A change in the position of a demand or supply curve, indicating a change in the quantity demanded or supplied at every price.

Subsidy

Financial aid supplied by the government to an industry or business, with the aim of keeping prices low for consumers or aiding the business to be competitive.