An agreement between ﬁrms to create a separate, co-owned entity established to pursue a joint goal is called a:
A) Consolidation.
B) Strategic alliance.
C) Joint venture.
D) Merged alliance.
E) Takeover project.

Question

Quizplus · Accepted Answer

A joint venture is a specific type of strategic alliance in which firms establish a separate, co-owned entity to pursue a joint goal. This entity operates independently of the firms that created it, and therefore has its own structure and management. Joint ventures are a popular form of collaboration when firms want to share resources, knowledge, or expertise to achieve a goal that they couldn't pursue alone. Consolidation refers to the merging of two or more firms into a single entity, while a merged alliance is not a recognized term in business. A takeover project refers to the acquisition of a company by another firm, which is not the same as a joint venture.

An Agreement Between ﬁRms to Create a Separate, Co-Owned Entity