The advantages of using a licensing strategy to participate in foreign markets include
A)being especially well suited to the use of cross-market subsidization.
B)being able to charge lower prices than rivals.
C)enabling a company to achieve competitive advantage quickly and easily.
D)being able to leverage the company's technical know-how or patents without committing significant additional resources to markets that are unfamiliar,politically volatile,economically uncertain,or otherwise risky.
E)being able to achieve higher product quality and better product performance than with an export strategy.

Question

Quizplus · Accepted Answer

Licensing allows a company to use its technical know-how or patents in foreign markets without committing significant additional resources or taking on too much risk. This can enable the company to enter markets quickly and easily, giving it a competitive advantage. Cross-market subsidization (option A) is not directly related to licensing and may not be appropriate in all situations. Option B and E are not generally advantages of licensing, as pricing and product quality are typically determined by the licensee.

The Advantages of Using a Licensing Strategy to Participate in Foreign