Question :
71.Which of the following a disadvantage of exporting as a : 1299439
71.Which of the following is a disadvantage of exporting as a mode of entry into foreign markets?
A. The firm incurs the costs of establishing manufacturing operations in the host country.
B. The firm is unable to realize experience curve economies through exporting.
C. The local agents may not market the firm’s products as well as the firm would if it managed its marketing itself.
D. The firm cannot use countertrading options when exporting.
E. The firm may not realize substantial scale economies from its global sales volume via exporting.
72.In exporting, problems with local marketing agents can be overcome by:
A. selling intangible property to a franchisee and insisting on rules to conduct the business.
B. changing agents frequently.
C. engaging in turnkey projects and exporting process technology to foreign firms.
D. entering into cross-licensing agreements with foreign firms.
E. setting up wholly owned subsidiaries in foreign nations to handle local marketing.
73.In a _____, a mode of entry into foreign markets, a firm agrees to set up an operating plant for a foreign client and hand over the plant when it is fully operational.
A. franchising agreement
B. turnkey project
C. licensing agreement
D. wholly owned subsidiary
E. joint venture
74.In the context of modes of entry into foreign markets, turnkey projects are a means of:
A. granting rights to intangible property to other firms.
B. establishing firms that are jointly owned by two or more otherwise independent firms.
C. exporting process technology to other countries.
D. setting up wholly owned subsidiaries in foreign nations.
E. selling products produced in one country to residents of other countries.
75.Which of the following is an advantage of turnkey projects as a mode of entry into foreign markets?
A. It is an ideal way to gain entry into a country where FDI is not limited by government regulations.
B. It is a useful strategy to earn great returns from the know-how of a technologically complex process.
C. It is an ideal way to establish a firm’s long-term presence in a foreign country.
D. It helps protect a firm’s competitive advantage.
E. The firm that enters into a turnkey project with a foreign enterprise avoids giving rise to potential competitors.
76.Which of the following is an advantage of turnkey projects as a mode of entry into foreign markets?
A. It helps create competition which in turn increases the quality of production.
B. It can be less risky than conventional FDI.
C. It is an ideal way to establish a long-term presence in a foreign country.
D. It helps protect the competitive advantage of process technology.
E. The firm that enters into a turnkey project with a foreign enterprise avoids giving rise to potential competitors.
77.A drawback of a(n) _____, a mode of entry into foreign markets, is that the firm that uses this strategy will have no long-term interest in a foreign country.
A. joint venture
B. greenfield venture
C. acquisition
D. turnkey deal
E. franchising agreement
78.Turnkey projects being short-term propositions can be disadvantageous for a firm if a country subsequently proves to be a major market for the output of the process that has been exported. The firm can get around this problem by:
A. selling competitive advantage to competitors.
B. competing with the local firm in the global market.
C. taking a minority equity interest in the operation.
D. withholding vital process technology from the local firm.
E. establishing a joint venture with a local firm.
79.In a(n) _____,a mode of entry into foreign markets, a firm grants the rights to intangible property to another firm for a specified period, and in return, receives a royalty fee.
A. licensing agreement
B. turnkey project
C. acquisition
D. joint venture
E. wholly owned subsidiary
80.Which of the following is true of licensing as a mode of entry into foreign markets?
A. A licensor grants the rights to tangible property to a licensee.
B. A licensing agreement grants rights to intangible property to a licensee for an unspecified period.
C. The licensor receives a royalty fee from the licensee.
D. The licensor puts up all of the capital necessary to start a business.
E. The licensor maintains control over its technological know-how.
