Question 1

While franchising facilitates rapid internationalization, compared to FDI, it affords the firm less control over its foreign operations.

Accepted Answer

Franchising involves granting a third party (franchisee) the right to use the firm's brand and operate under the firm's established system of doing business. While this can enable a firm to rapidly expand internationally, it typically involves less control over the franchisee's operations compared to setting up wholly-owned subsidiaries through FDI.

Question 2

Which of the following is a characteristic of successful international retailers?

Accepted Answer

Successful international retailers typically have an entrepreneurial approach to foreign markets, meaning they are willing to take risks and adapt their strategies to fit the target market. They also have a strong understanding of the target market, which helps them tailor their products and marketing efforts accordingly.

Question 3

Discuss the four key differences between project-based, nonequity ventures and equity ventures.

Accepted Answer

The answer of Discuss the four key differences between project-based,...

Question 4

Cross-licensing agreements are a type of project-based, nonequity venture in which the partners agree to allow access to licensed intellectual property developed by the other on preferential terms.

Accepted Answer

This statement accurately describes cross-licensing agreements.

Question 5

Describe the four primary challenges faced by retailers when they expand overseas. Provide examples of mistakes made by retailers in foreign markets.

Accepted Answer

The answer of Describe the four primary challenges faced by...

Question 6

Equity joint ventures have the simplest management structure.

Accepted Answer

Equity joint ventures typically have a more complex management structure due to the involvement of multiple parties with differing opinions and interests. Decisions and responsibilities may need to be shared and agreed upon among the partners, which can lead to more complicated management processes.

Question 7

Project-based, nonequity ventures are difficult to set up.

Accepted Answer

Project-based, nonequity ventures, such as collaborations or partnerships where resources are shared but not equity, can be easier to set up compared to equity-based ventures because they often require less legal and financial structuring.

Question 8

The failure rate of collaborative ventures is higher in developing economies than in advanced economies.

Accepted Answer

Collaborative ventures require strong institutional and regulatory frameworks, which may be lacking in developing economies. This increases the risk of failure for such ventures in developing economies, as compared to advanced economies.

Question 9

Discuss four strategies that managers can employ in order to increase the chances of a successful collaborative venture.

Accepted Answer

The answer of Discuss four strategies that managers can employ...

Question 10

Describe the advantages of international collaborative ventures, and describe the potential risks of collaboration.

Accepted Answer

The answer of Describe the advantages of international collaborative ventures,...

Quiz 14: Foreign Direct Investment and Collaborative Ventures