Ericsson is a Swedish telecommunications firm.GCCT is a French electronics switch manufacturer.With the use of Ericsson's money and technology and GCCT's knowledge of the French market,the two companies created a new entity and beat out AT&T for a $100 million contract with the French government.The relationship between the two companies is an example of:
A) contract manufacturing
B) exporting
C) direct investment
D) contract bidding
E) a joint venture

Question

Quizplus · Accepted Answer

The relationship between Ericsson and GCCT is an example of a joint venture, which involves two or more companies joining together to create a new entity in which they share ownership, control, and profits. In this case, Ericsson and GCCT combined their resources and knowledge to form a new entity that was able to secure a major contract with the French government. Contract manufacturing, exporting, direct investment, and contract bidding do not accurately describe this relationship.

Ericsson Is a Swedish Telecommunications Firm