Joint ventures:
A) Slow the speed of entry into a new field or market
B) Are considered a more risky diversification option than mergers
C) Encourage the entry of new competitors
D) Are often motivated by the desire to share resources across companies

Question

Quizplus · Accepted Answer

Joint ventures are often motivated by the desire to share resources across companies, such as technology, expertise, and access to markets. By collaborating, companies can minimize their individual risk while still gaining the benefits of diversification. Joint ventures can also help companies enter new markets more quickly and at lower costs, as they can leverage each other's strengths and capabilities. Joint ventures do not encourage the entry of new competitors and are generally considered less risky than mergers.

Joint Ventures