In a non-equity-based alliance,which of the following should be high for possible upgrading to equity-based relationships?
A) Degree of tacitness
B) Importance of direct organizational monitoring and control
C) Potential as real option
D) Influence of formal institutions

Question

In a non-equity-based alliance,which of the following should be high for possible upgrading to equity-based relationships? 
A) Degree of tacitness 
B) Importance of direct organizational monitoring and control 
C) Potential as real option 
D) Influence of formal institutions

Quizplus · Accepted Answer

Potential as real option should be high for possible upgrading to equity-based relationships. Real options refer to the value created by the potential for the alliance to create future opportunities that are not currently known. This value can be captured through an equity-based relationship, thus making potential as a real option a key factor in determining whether to upgrade to an equity-based alliance. Degree of tacitness, importance of direct organizational monitoring and control, and influence of formal institutions are not as important in determining whether to upgrade to an equity-based alliance.

In a Non-Equity-Based Alliance,which of the Following Should Be High