Which of the following is a disadvantage of a strategic alliance?
A)Entering into a strategic alliance makes it difficult for a firm to enter into a foreign market.
B)As a result of strategic alliance,fixed costs of developing new products tend to increase.
C)Strategic alliance gives competitors a low-cost route to new technology and markets.
D)Firms that enter into a strategic alliance with a foreign firm tend to face higher trade barriers.
E)Strategic alliance always leads to a loss to either of the firms involved.

Question

Quizplus · Accepted Answer

By entering into a strategic alliance, a firm may be sharing its technology or market access with its partner. This may give competitors a low-cost and low-risk entry into those same technologies or markets, reducing the advantage that the firms may have enjoyed.

Which of the Following Is a Disadvantage of a Strategic