A firm that expects rapid imitation of its core technology by competitors should:
A) revert to older technologies.
B) engage in exporting on a large scale.
C) license its technology to foreign firms.
D) set up a wholly owned subsidiary.
E) enter into a joint venture with a foreign firm.

Question

Quizplus · Accepted Answer

Licensing the technology to foreign firms can generate revenue for the firm while also slowing down the pace of imitation by competitors. This is because licensing agreements often come with contractual obligations and restrictions that limit the ability of the licensee to produce identical or similar products or technologies. This can give the firm more time to develop new innovations or strategies to stay ahead of competitors. Reverting to older technologies or engaging in exporting on a large scale may not effectively address the issue of rapid imitation by competitors, while setting up a wholly owned subsidiary or entering into a joint venture with a foreign firm may involve significant costs and risks.

A Firm That Expects Rapid Imitation of Its Core Technology