IBUS CHAPTER 14

1) If a firm can realize location economies by moving production elsewhere, it should avoid
A) Exporting

2) Which of the following is a distinct advantage of exporting?
A) It avoids the often substantial costs of establishing manufacturing operations in host
country.

3) Which of the following is a distinct advantage of exporting
B) It may help a firm achieve experience curve and location economies

4) When and exporting firms finds that is local agent is also carrying competitors product the
firm may switch to a ____ to handle local marketing sales
A) Wholly- owned subsidiary

5) Identify the incorrect statement about turnkey project
B) They are most common in industries which use inexpensive production technologies.

6) In which of the following industries are turnkey project the most common?
B.. Chemical, pharmaceutical, and metal refining

7) Many Western firms that said oil-refining technology to firms in GULF-STATES, oil market.
This example
A) A firm entering a turnkey project with a foreign enterprise, inadvertently creating
competitors.
8) Firms that lack the capital necessary to develop foreign
B) Licensing

9) An arrangement whereby a firms grants the rights to intangible property to another entity
for Loyalties is an agreement
C) Licensing

10) Patents , inventions, formulas, process, designs, copyrights and trademark are
C. Intangible Property

11) Cross-licensing agreement are increasingly common in the
B. High technology

12) If a service from want to build a global pre
D. Franchising

13) Which of the following statement about franchising is True
C. It is a specialized form of licensing
14) Which of the following is an advantage of franchising?
B. A firm is relieved of many of the cost and risk of opening a foreign market on its own.

15. Firms engaging ____ in with a local company can benefit from a local partner knowledge, host
country competitive conditions, culture language, political system and business system.
B) Joint Ventures

18 . A firm that establishes a ______ must bear the full cost and risk entering of
B. Wholly-owners subsidiary

19. If a firms core competency is based on control power proprietary, xxxxxxxxxxx arrangement, if
possible do minimize the risk of losing control over that technology
A) Licensing; Joint Ventures