New ventures:
A)should be killed if they don't make a profit within three years.
B)are often preferred by technology-based companies.
C)are preferred compared to acquisitions when entry barriers are high.
D)are less risky than acquisitions.
E)are best when the company is entering the industry on a small scale.

Question

Quizplus · Accepted Answer

Technology-based companies often prefer new ventures as they are typically more innovative and can provide a competitive advantage in the market. These companies also tend to have the resources and capabilities to support the development of new ventures.

Answer: C
 When entry barriers are high, it can be difficult to enter the market through acquisitions. New ventures can be a preferred option in these cases as they allow companies to enter the market gradually and build their capabilities.

Answer: None of the other choices are accurate or complete statements.

New Ventures