Question 1

Where counterfeiting and piracy are commonplace, companies are reluctant to invent, innovate, and market legitimate products, which reduces consumer choices and ultimately lowers living standards.

Accepted Answer

Counterfeiting and piracy undermine the incentives for innovation and investment in new products, as companies face the risk of not being able to recoup their costs or earn profits due to the competition with illegal copies. This can lead to a decrease in the variety and quality of products available to consumers and negatively impact economic growth and living standards.

Question 2

Advanced economies have taken the lead in signing treaties that support international protection of intellectual property.

Accepted Answer

Advanced economies, due to their significant investments in research and development, have been at the forefront of advocating for and signing treaties that support the international protection of intellectual property to safeguard their innovations and creative works on a global scale.

Question 3

Describe three challenges faced by professional service firms when they internationalize.

Accepted Answer

The answer of Describe three challenges faced by professional service...

Question 4

Which of the following is an essential method used by a focal firm to protect its intellectual property (IP) in a foreign country?
A) lobbying foreign governments for stronger intellectual property laws
B) avoiding trade in countries with weak intellectual property laws
C) bribing foreign government officials
D) research to understand IP laws and protections in target countries

Accepted Answer

Researching to understand IP laws and protections in target countries is essential for a focal firm to effectively protect its intellectual property when operating internationally.

Question 5

Infringement of intellectual property is the unauthorized use or reproduction of products and services protected by a patent, copyright, trademark, or other intellectual property right.

Accepted Answer

Infringement of intellectual property occurs when someone uses or reproduces products and services protected by intellectual property rights (such as patents, copyrights, trademarks) without authorization from the rights holder.

Question 6

Big Boy Burgers (Scenario)
Big Boy Burgers (BBB) is an American fast food restaurant chain that has franchises around the world. Recently, BBB managers have been concerned about protecting the firm's intellectual property, which includes the recipes for its unique burger sauces and specialty burger buns. Although BBB has never experienced a theft of intellectual property, the firm's managers feel BBB should be more cautious. Managers are meeting with security and legal experts to discuss the options available to the firm that would protect BBB from future international problems.
-Which of the following questions would be more important for the experts to evaluate when determining how to ensure intellectual property protection for Big Boy Burgers?
A) What should be the penalties for theft of the recipes for their unique burger sauces and specialty burger buns?
B) Is BBB partnering with ethical franchisees that have no intention of becoming BBB competitors in the future?
C) What are the commonly counterfeited goods in the market?
D) How are BBB franchisees modifying recipes and menus to meet the needs and desires of customers in local markets?

Accepted Answer

Evaluating whether BBB is partnering with ethical franchisees is crucial because it directly relates to the risk of intellectual property theft. Ethical franchisees are less likely to misuse or steal proprietary information.

Question 7

In international leasing, a major advantage for the lessor is the ability to gain quick access to target markets, while putting assets to use earning profits.

Accepted Answer

International leasing allows lessors to quickly enter new markets by providing assets for lease to local businesses, enabling them to earn profits without the need for significant upfront investments in those markets.

Question 8

Big Boy Burgers (Scenario)
Big Boy Burgers (BBB) is an American fast food restaurant chain that has franchises around the world. Recently, BBB managers have been concerned about protecting the firm's intellectual property, which includes the recipes for its unique burger sauces and specialty burger buns. Although BBB has never experienced a theft of intellectual property, the firm's managers feel BBB should be more cautious. Managers are meeting with security and legal experts to discuss the options available to the firm that would protect BBB from future international problems.
-Which of the following statements most likely supports BBB legal experts fully investigating the intellectual property laws of each nation in which BBB has franchises?
A) Intellectual property laws and its enforcement vary from country to country.
B) Patents and trademarks granted in one country will transfer to another country.
C) TRIPS protects the intellectual property of firms doing business in any nation.
D) Nations with numerous IPR violators are beginning to comply with the WTO.

Accepted Answer

Intellectual property laws and their enforcement indeed vary significantly from country to country, which necessitates a thorough investigation by legal experts to ensure BBB's intellectual property is adequately protected in each jurisdiction where it operates.

Question 9

Including non-compete clauses in employee contracts helps prevent employees from serving competitors for some years after leaving the firm.

Accepted Answer

Non-compete clauses are designed to prevent employees from joining competing firms or starting a competing business within a certain timeframe and geographical area after leaving the company, thereby protecting the company's interests and proprietary information.

Question 10

When consumers buy counterfeit goods, payments are lost to the firm that invented the product and not to illicit enterprises.

Accepted Answer

When consumers buy counterfeit goods, payments are lost to the firm that invented the product, not to illicit enterprises.

Question 11

Describe the guidelines for protecting intellectual property.

Accepted Answer

The answer of Describe the guidelines for protecting intellectual property....

Question 12

Before undertaking contractual entry strategies abroad, management ________.
A) should bribe government officials to ensure protection of intellectual property
B) should register patents and copyrights with local governments
C) should keep information about intellectual property confidential from all franchisees in countries with weak anti-piracy laws
D) understand and follow subjective moral and ethical standards across markets

Accepted Answer

Registering patents and copyrights with local governments is a crucial step for companies to protect their intellectual property rights when entering foreign markets. This legal action helps to ensure that the company's innovations and creative works are safeguarded under the local laws of the country they are expanding into.

Question 13

Big Boy Burgers (Scenario)
Big Boy Burgers (BBB) is an American fast food restaurant chain that has franchises around the world. Recently, BBB managers have been concerned about protecting the firm's intellectual property, which includes the recipes for its unique burger sauces and specialty burger buns. Although BBB has never experienced a theft of intellectual property, the firm's managers feel BBB should be more cautious. Managers are meeting with security and legal experts to discuss the options available to the firm that would protect BBB from future international problems.
-The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) was created by the ________.
A) International Monetary Fund (IMF)
B) United Nations
C) World Trade Organization (WTO)
D) World Bank

Accepted Answer

The Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) was created by the World Trade Organization (WTO) to set minimum standards for many forms of intellectual property regulation as applied to nationals of other WTO Members.

Question 14

Laws that govern contractual obligations are uniform across countries; therefore, it makes contract enforcement abroad easier for firms.

Accepted Answer

Contractual laws vary significantly from one country to another, affecting how contracts are enforced internationally and making it more complex for firms to navigate these differences.

Question 15

Which of the following statements is TRUE of infringement of intellectual property?
A) The most commonly counterfeited goods include heavy machinery and computer manufacturing.
B) It amounts to piracy and takes the form of production and distribution of counterfeit goods.
C) It is the ability to control important intellectual property before it reaches competitors.
D) Counterfeiting and piracy can be particularly troublesome in advanced economies because of subjective ethical standards.

Accepted Answer

Infringement of intellectual property refers to the unauthorized use of intellectual property rights, such as copyrights, trademarks, patents, or trade secrets. This often includes piracy, which is the unauthorized reproduction or distribution of copyrighted material, and counterfeiting, which involves producing fake goods that are passed off as genuine. These activities violate the rights of the original creators or owners of the intellectual property.

Question 16

An arrangement in which a contractor supplies managerial know-how to operate a hotel, hospital, airport, or other facility in exchange for compensation is known as offshoring.

Accepted Answer

This arrangement is known as a management contract, not offshoring. Offshoring refers to relocating a business process from one country to another.

Quiz 15: Licensing, Franchising, and Other Contractual Strategies