A disadvantage of licensing is that the licensing company (licensor)
A) May lose control over its technology.
B) Takes on greater political risk.
C) Takes on greater development costs.
D) Realizes higher profit margins.
E) Frequently grows too fast as a result.

Question

Quizplus · Accepted Answer

A problem arises with international licensing when a company licenses its technological expertise to overseas companies when technological know-how is the basis of the competitive advantage. It may lose control over the technology by licensing it.

A Disadvantage of Licensing Is That the Licensing Company (Licensor)