Exam 15: Direct Investment and Collaborative Strategies

Tom, a manager at an MNE, has been given the task of identifying a pool of companies with which the firm might form collaborative arrangements.Which of the following activities would be LEAST useful for Tom?

The more a company engages in collaborative agreements, the more it loses control over decisions and their implementation.

A licensing agreement is a contract for the granting of rights on tangible property.

Which of the following would most likely trigger internal tensions as a firm's modes of foreign operations change?

Collaborative agreements allow companies to specialize more in those activities that best fit their competencies.

Appropriability theory describes a firm's desire to deny rivals access to its competitive resources.

An agreement for the use of a trademark and assistance with business operations is known as a cross-licensing agreement.

What is a master franchise?

When entering foreign countries, many franchisors encounter difficulty in transferring the domestic success factors of product and service standardization.

Few turnkey projects to date have been in remote areas of the world.

An international joint venture is an agreement between two or more companies for the use of a trademark.

A greenfield investment is another name for a company's decision to ________.

When a company wants to be compensated in a foreign subsidiary beyond its contribution in capital and managerial resources, it often ________.

What motives do businesses have for entering into collaborative arrangements? What are some of the problems associated with collaborative arrangements?

What is the difference between licensing and cross-licensing? What factors do firms need to consider before entering into licensing agreements?

Coca-Cola has collaborative arrangements whereby it produces concentrate that it sells to other companies to bottle its drinks.Which of the following terms best describes this type of arrangement?

In a licensing arrangement, it is rare for companies to agree to a front-end payment to cover technology transfer costs.

According to the appropriability theory and the internalization theory, why would companies want to control their foreign operations?

A U.S.firm owns 100% of its production facility in Brazil; thus it is most likely using a(n)________ strategy.

Small economies are sometimes less successful than large countries in attracting FDI by raising import restrictions.What is the most likely reason for this?