Question 1

Explain the relationship between first-mover disadvantages and pioneering costs.

Accepted Answer

When a firm enters a market prior to oth...

Question 2

Discuss the trade-offs associated with large-scale entry versus small-scale entry.

Accepted Answer

It is important for a firm to think thro...

Question 3

In a _____,the firm owns 100 percent of the stock.

Accepted Answer

A)   joint venture
B)   wholly owned subsidiary
C)   turnkey project
D)   franchising agreementE) None of the above
F) B) and C)

Question 4

_____ refer to cooperative agreements between potential or actual competitors.

Accepted Answer

A)   Greenfield investments
B)   Strategic alliances
C)   Takeovers
D)   Licensing agreementsE) A) and C)
F) A) and D)

Question 5

What is the primary advantage of licensing?

Accepted Answer

A)   It helps a firm avoid the development costs associated with opening a foreign market.
B)   It gives a firm the tight control over manufacturing,marketing,and strategy.
C)   It helps a firm achieve experience curve and location economies.
D)   It increases a firm's ability to utilize a coordinated strategy.E) A) and B)
F) All of the above

Question 6

A wholly owned subsidiary limits a firm's control over operations in different countries.

Accepted Answer

A) True 
 B)False

Question 7

Exporting is most appropriate when lower-cost locations for manufacturing the product can be found abroad.

Accepted Answer

A) True 
 B)False

Question 8

If a firm is trying to enter a market where there are already well-established companies,and where global competitors are also interested in establishing a presence,the firm should choose a greenfield investment.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following statements about small-scale entry is true?

Accepted Answer

A)   The commitment associated with a small-scale entry makes it possible for the small-scale entrant to capture first-mover advantages.
B)   Small-scale entry is a way to gather information about a foreign market before deciding whether to enter on a significant scale.
C)   By giving a firm time to collect information,small-scale entry increases the risks associated with a subsequent large-scale entry.
D)   Small-scale entry limits a firm's ability to learn about a foreign market thereby also limiting the firm's exposure to that market.E) A) and D)
F) A) and C)

Question 10

If a firm's core competency is based on control over proprietary technological know-how,_____ and _____ arrangements should be avoided if possible to minimize the risk of losing control over that technology.

Accepted Answer

A)   licensing; joint-venture
B)   wholly owned subsidiary; exporting
C)   turnkey contracts; exporting
D)   exporting; joint-ventureE) A) and B)
F) C) and D)

Question 11

How can a firm increase the probability of selecting a good partner?

Accepted Answer

To increase the probability of selecting...

Question 12

A small-scale entrant is more likely than a large-scale entrant to capture first-mover advantages associated with demand preemption,scale economies,and switching costs.

Accepted Answer

A) True 
 B)False

Question 13

Briefly explain the advantages and disadvantages of franchising agreements.

Accepted Answer

There are several advantages of franchis...

Question 14

Exporting is advantageous because it avoids the cost of establishing manufacturing operations in the host country and because it may help a firm achieve experience curve and location economies.

Accepted Answer

A) True 
 B)False

Question 15

Discuss the three primary characteristics of a good ally.

Accepted Answer

A good ally,or partner,has three charact...

Question 16

A large-scale entrant is more likely than a small-scale entrant to be able to capture first-mover advantages associated with _____.

Accepted Answer

A)   scale economies
B)   diseconomies of scale
C)   pioneering costs
D)   diseconomies of scopeE) B) and D)
F) B) and C)

Question 17

Early entrants to a market that are able to create switching costs that tie the customer to the product are capitalizing on ______.

Accepted Answer

A)   first-mover advantages
B)   pioneering costs
C)   economies of scale
D)   late-mover advantagesE) A) and B)
F) A) and C)

Question 18

Why do acquisitions fail?

Accepted Answer

Acquisitions fail for several reasons.Fi...

Question 19

A strategic commitment can be reversed by the top management according to their convenience.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following is a first-mover advantage?

Accepted Answer

A)   lower research and development costs and marketing costs than other firms
B)   ability to preempt rivals and capture demand by establishing a strong brand name
C)   ability to capitalize on the work done by other firms
D)   creation of innovative products at lower costs than other firmsE) A) and B)
F) B) and C)

Exam 15: Entry Strategy and Strategic Alliances

If a firm's core competency is based on control over proprietary technological know-how,_____ and _____ arrangements should be avoided if possible to minimize the risk of losing control over that technology.

Correct AnswerverifiedShow Answer

A wholly owned subsidiary limits a firm's control over operations in different countries.

Correct AnswerverifiedShow Answer

Discuss the trade-offs associated with large-scale entry versus small-scale entry.

Correct AnswerverifiedIt is important for a firm to think thro...View AnswerShow Answer

A large-scale entrant is more likely than a small-scale entrant to be able to capture first-mover advantages associated with _____.

Correct AnswerverifiedShow Answer

If a firm is trying to enter a market where there are already well-established companies,and where global competitors are also interested in establishing a presence,the firm should choose a greenfield investment.

Correct AnswerverifiedShow Answer

A strategic commitment can be reversed by the top management according to their convenience.

Correct AnswerverifiedShow Answer

_____ refer to cooperative agreements between potential or actual competitors.

Correct AnswerverifiedShow Answer

Exporting is most appropriate when lower-cost locations for manufacturing the product can be found abroad.

Correct AnswerverifiedShow Answer

Exporting is advantageous because it avoids the cost of establishing manufacturing operations in the host country and because it may help a firm achieve experience curve and location economies.

Correct AnswerverifiedShow Answer

Which of the following statements about small-scale entry is true?

Correct AnswerverifiedShow Answer

Early entrants to a market that are able to create switching costs that tie the customer to the product are capitalizing on ______.

Correct AnswerverifiedShow Answer

Why do acquisitions fail?

Correct AnswerverifiedAcquisitions fail for several reasons.Fi...View AnswerShow Answer

Which of the following is a first-mover advantage?

Correct AnswerverifiedShow Answer

A small-scale entrant is more likely than a large-scale entrant to capture first-mover advantages associated with demand preemption,scale economies,and switching costs.

Correct AnswerverifiedShow Answer

In a _____,the firm owns 100 percent of the stock.

Correct AnswerverifiedShow Answer

How can a firm increase the probability of selecting a good partner?

Correct AnswerverifiedTo increase the probability of selecting...View AnswerShow Answer

Briefly explain the advantages and disadvantages of franchising agreements.

Correct AnswerverifiedThere are several advantages of franchis...View AnswerShow Answer

What is the primary advantage of licensing?

Correct AnswerverifiedShow Answer

Discuss the three primary characteristics of a good ally.

Correct AnswerverifiedA good ally,or partner,has three charact...View AnswerShow Answer

Explain the relationship between first-mover disadvantages and pioneering costs.

Correct AnswerverifiedWhen a firm enters a market prior to oth...View AnswerShow Answer

If a firm's core competency is based on control over proprietary technological know-how,_ and _ arrangements should be avoided if possible to minimize the risk of losing control over that technology.

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It is important for a firm to think thro...
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Acquisitions fail for several reasons.Fi...
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Correct Answer
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To increase the probability of selecting...
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There are several advantages of franchis...
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Correct Answer
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A good ally,or partner,has three charact...
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When a firm enters a market prior to oth...
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