Licensing is best described as:
A) a nonequity method of international business in which an entrepreneur contracts his or her management techniques and skills to a (foreign) purchasing company.
B) a method of doing international business whereby a foreign entrepreneur supplies the manufacturing technology or infrastructure for a business and then turns it over to local owners.
C) a method that involves giving a foreign manufacturer the right to use a patent, technology, production process, or product in return for the payment of a royalty.
D) an equity partnership that involves selling patents to foreign governments.

Question

Licensing is best described as: 
A) a nonequity method of international business in which an entrepreneur contracts his or her management techniques and skills to a (foreign) purchasing company.
B) a method of doing international business whereby a foreign entrepreneur supplies the manufacturing technology or infrastructure for a business and then turns it over to local owners.
C) a method that involves giving a foreign manufacturer the right to use a patent, technology, production process, or product in return for the payment of a royalty.
D) an equity partnership that involves selling patents to foreign governments.

Quizplus · Accepted Answer

Licensing involves granting a foreign manufacturer the right to use a patent, technology, production process or product for a fee or royalty payment. This option allows for the licensor to maintain ownership of the patent or technology while the licensee gains the right to use it for a specified period and within a specific territory. It is a common way for companies to penetrate foreign markets without investing in manufacturing facilities. The other options such as A, B, and D do not accurately describe the concept of licensing in international business.

Licensing Is Best Described As