Exam 13: Selecting and Managing Entry Modes

All of the following are true of direct exporting EXCEPT ________.

When an exporter ships merchandise and later bills the importer for its value it is using a(n) ________ type of export/import financing.

Distributors take ownership of merchandise when it enters their country.

A buyback joint venture is formed when each partner requires the same component in its production process.

A company that exports products on behalf of an indirect exporter is called a(n) ________.

Letters of credit are popular among traders because banks assume most of the risks.

Which of these refers to the institutional arrangement by which a firm gets its products, technologies, human skills, or other resources into a market?

A(n) ________ is formed when each joint venture partner requires the same component in its production process.

Which of the following can be modified by the bank issuing the letter of credit without obtaining the approval of either the exporter or importer?

When joint venture partners choose to invest together in upstream business activities, the joint venture is characterized by ________.

Since the 1960s, formerly communist countries in Eastern and Central Europe have extensively used countertrade.

A wholly owned subsidiary is a facility owned and controlled by a single parent company.

Countertrade can provide access to markets that are otherwise closed because of a lack of hard currency.

________ is countertrade whereby one company sells to another its obligation to make a purchase in a given country.

Indirect exporting occurs when a company sells its products to intermediaries who then resell to buyers in a target market.

A relationship whereby two or more entities form a separate company to achieve the strategic goals of each is called a strategic alliance.

Offset differs from a counterpurchase in that it does not specify the type of product that must be purchased, just the amount that will be spent.

An international ocean shipment requires an inland bill of lading to get the shipment to the exporter's border, and an ocean bill of lading for water transport to the importer nation.

Explain why companies should consider exporting. Describe the four-step model of developing a successful export strategy.

A sight draft extends the period of time following delivery by which the importer must pay for goods.