In International Markets, a Firm Can Sell Its Management and Marketing

question 258

Multiple Choice

In international markets, a firm can sell its management and marketing know-how while letting locals own the production and distribution facilities by using

• A) licensing.
• B) exporting.
• C) joint venturing.
• D) management contracting.
• E) direct investment.

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Definitions:

Total Fixed Costs

The sum of all costs that remain constant regardless of the level of production or sales, such as rent, salaries, or loan payments.

Profit-Maximizing Output

The level of production at which a firm achieves the maximum possible profit, where marginal cost equals marginal revenue.

Marginal Revenue

The additional revenue generated from selling one more unit of a good or service.

Marginal Costs

The rise in overall expenses resulting from the production of an additional unit.