Which of the following involves granting a foreign entity the right to produce and sell the firm's product in return for a royalty fee on every unit sold?
A)Franchising
B)Exporting
C)Licensing
D)Foreign Direct Investment
E)Merger

Question

Quizplus · Accepted Answer

Licensing involves granting a foreign entity the right to produce and sell the firm's product in return for a royalty fee on every unit sold. Franchising involves granting the right to use a business model and brand name in exchange for a fee and ongoing royalties. Exporting involves selling products to foreign markets, while foreign direct investment involves establishing a physical presence in a foreign market, such as setting up a subsidiary or joint venture. A merger involves the combination of two or more companies into a single entity. Therefore, the correct option is licensing.

Which of the Following Involves Granting a Foreign Entity the Right