When entering a foreign market, Mountain Stream Brewery entered into an agreement with a local firm to brew and market Mountain Stream's beer. This is an example of
A) licensing.
B) franchising.
C) foreign direct investment.
D) foreign subsidiaries.

Question

Quizplus · Accepted Answer

Licensing reduces the risk of entering foreign markets. In this case, Mountain Stream spends little money to produce and market its product in foreign markets. The foreign-based licensee incurs these costs.

When Entering a Foreign Market, Mountain Stream Brewery Entered into an Agreement