Disadvantage of a Joint Venture Arrangement When Entering a New

question 22

Multiple Choice

disadvantage of a joint venture arrangement when entering a new global market is that

• A) no intermediaries are used to distribute the product.
• B) the first entering the foreign marketing must pay royalties to the host firm.
• C) one of the companies forgoes control over its product.
• D) when the two companies disagree about policies.
• E) this method has the least amount of subsidies from the host country's government.

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Definitions:

Total Asset Turnover

A ratio calculating how effectively a company utilizes its assets to produce sales income.

Return on Equity

A measure of a corporation's profitability, indicated by the amount of net income returned as a percentage of shareholders equity.

Return on Assets

A financial ratio indicating how efficiently a company uses its assets to generate profit.