A company is considering forming an alliance with a foreign manufacturer to develop a new type of polymer that can be used for industrial applications. Such a partnership represents what type of direct investment?
A) Franchising
B) Joint Venture
C) Wholly owned affiliate
D) Greenfield venture
E) Outsourcing

Question

Quizplus · Accepted Answer

A Joint Venture is a direct investment where two or more companies enter into a partnership to pursue a specific project or business activity together, sharing both risks and rewards. In this case, the company is forming an alliance with a foreign manufacturer to develop a new product, which falls under the definition of a joint venture.

A Company Is Considering Forming an Alliance with a Foreign