When Managers Pool or Share Their Organization's Resources and Know-How

question 27

Multiple Choice

When managers pool or share their organization's resources and know-how with those of a foreign company,and the two organizations share the rewards or risks of starting a new venture in a foreign country,the two organizations are involved in:

• A) a joint venture.
• B) a strategic alliance.
• C) differentiation.
• D) licensing.
• E) a multidomestic partnership.

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Definitions:

Retained Earnings

The portion of net earnings not distributed as dividends but retained by the company to reinvest in its core business or to pay debt.

Stock Dividends

Dividends paid to shareholders in the form of additional shares of stock instead of cash.

Contributed Capital

The total value of the cash and other assets received by a company from its shareholders in exchange for stock, also known as paid-in capital.

Preferred Stock

A class of ownership in a corporation with a higher claim on assets and earnings than common stock, often paying fixed dividends.