It is easy to take advantage of location economies when using a licensing strategy.

Question

Quizplus · Accepted Answer

Licensing typically involves granting permission for a third party to use a company's intellectual property (e.g. trademark, patent, copyright) in exchange for royalties or fees. While licensing may provide some benefits such as increased revenue, it does not necessarily involve location economies. Location economies refer to the advantages that arise from performing a particular business function in a specific location due to factors such as lower labor costs or access to specialized suppliers. These advantages are more commonly associated with other strategies such as foreign direct investment or global sourcing.

It Is Easy to Take Advantage of Location Economies When