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Exam 12: Entering Foreign Markets

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Question 21

True/False

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A contractor agrees to handle every detail of the project for a foreign client,including the training of operating personnel in a turnkey project.

A) True
B) False

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Question 22

Multiple Choice

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_______________ is preferred to joint venture arrangements and to using foreign market agents.

A) Franchising
B) Exporting
C) Wholly owned subsidiary
D) Turnkey project
E) Merger

F) C) and E)
G) D) and E)

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Question 23

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If Pepsi and a Turkish firm established a jointly owned entity for the purpose of bottling soft drinks in Turkey,that would be an example of a:

According to the opening case,until 2003,JCB entered the Indian market in what way?

Ravenscraft and Scherer concluded in their study that many good companies were acquired between January 1990 and July 1995,and on average,their profits and market shares _______ following the acquisition.

An advantage of acquisitions is ______________.

Whereas primarily ________________ firms pursue licensing,primarily ____________ firms pursue franchising.

If a firm's competitive advantage is based on control over proprietary technological know- how,which of the following foreign entry modes should be avoided?

Which foreign market entry strategy has the following disadvantages: lack of long-term market presence,may inadvertently create a competitor,risk of selling a firm's competitive advantage?

Firms pursuing global or transnational strategies tend to prefer establishing joint ventures.

If two companies established a jointly owned entity for the purpose of building computers to export to Asia,that would be an example of a ___________________ form of foreign market entry.

The ______________ entrant is more likely than the ________________ entrant to be able to capture the first-mover advantages associated with demand pre-emption,scale economies,and switching costs.

If a firm's competitive advantage is based on control over proprietary technological know-how,licensing and joint venture arrangements are preferred methods of foreign market entry.

_______ takes advantage of a firm's competency in the area of assembling and running technologically complex projects.

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

You have been recently hired by the Canadian manufacturer of a branded line of fashion accessories.They are designed and manufactured in Canada and sold in the US and parts of the EU.This firm is known for being consistently ahead of the curve in the fashion market that appeals to women between the ages of 21 to 29.They have recently been approached by an Indonesian manufacturer and distributor of fashion accessories.Indonesia is not a priority for the company and they are not prepared to invest the resources to establish a marketing office in Indonesia.The Indonesian company has suggested licensing their line for manufacturing and sale in Indonesia.As a consultant you have been asked to evaluate this proposal and suggest steps the company could take to minimize risks associated with licensing.

Acquisitions often produce disappointing results,despite the argument for making them.

Many Chinese people wear glasses.As more Chinese acquire money they are choosing to have cosmetic surgery.One of the most popular is to have laser eye surgery to correct their vision.Lasik 20/20 is a Canadian company that has been doing very well in Canada with high-profile athletes and celebrities having their vision corrected with Lasik 20/20.They are looking to enter the Chinese market but do not know the best way to go about it.a.Describe in detail what would be your recommendation for how they should enter the Chinese market.b.Explain the reasons why you chose this entry strategy and the advantages and disadvantages compared to other possible methods a business might enter a country.

Acquisitions are quick to execute.

What type of entry allows a firm to learn about a foreign market while limiting the firm's exposure to that market?