An advantage of licensing as a method of entering global competition is that the
A)licensing company need not bear the costs and risks of opening up an overseas market.
B)licensing company has control over its technology.
C)licensing company has control over quality levels.
D)licensing company has lower communication costs.
E)licensee has lower production costs.

Question

Quizplus · Accepted Answer

When a company enters a foreign market through licensing, it allows a local company to use its intellectual property for a fee or royalty. This method eliminates the need for the licensing company to invest in foreign operations, establish distribution channels, or employ local staff. Therefore, the licensing company avoids financial risks associated with entering a foreign market.

An Advantage of Licensing as a Method of Entering Global