Which of the Following Is a Most Likely Reason for a Firm

Multiple Choice

Which of the following is a most likely reason for a firm to enter a licensing agreement?

A) A licensing arrangement allows firms to enter a foreign market without direct foreign investments.
B) For a firm to enter into a licensing agreement, it must have substantial capital.
C) A licensing agreement does not require firms to follow the local laws where they operate.
D) A licensing arrangement is used only if the firms have strong management skills and marketing strategies in the regions where they operate.
E) A licensing agreement is a risk free method for firms to expand in foreign markets.