In a licensing arrangement,the _____ bears the risk and cost of opening a foreign market.
A)licensee
B)licensor
C)acquiring firm
D)greenfield investor

Question

Quizplus · Accepted Answer

In a licensing arrangement, the licensee acquires the right to use the licensor's intellectual property in a foreign market, and therefore bears the risk and cost of opening that market. The licensee is essentially paying for the right to use the licensor's established brand, technology, or know-how in that market, and must invest the necessary resources to make the venture successful. The licensor, on the other hand, receives a fee or royalty for granting the license, but does not bear the same level of risk or cost for entering the foreign market.

In a Licensing Arrangement,the _____ Bears the Risk and Cost