Question 1

Sales companies will import in their own name from the parent and will invoice in the currency of the parent company.

Accepted Answer

Sales companies may import in their own name from the parent company, but they often invoice in the currency of the country where they are selling, not necessarily in the currency of the parent company. This is done to accommodate the local market and currency fluctuations.

Question 2

One way in which contract manufacturing is used is to subcontract assembly work or the production of parts to subsidiaries overseas.

Accepted Answer

False

Question 3

Direct exporting is simpler than indirect exporting because it requires neither special expertise nor large cash outlays.

Accepted Answer

Direct exporting involves selling directly to the market in another country, which requires understanding foreign market regulations, logistics, and possibly establishing a local presence, making it more complex and potentially requiring significant investment compared to indirect exporting through intermediaries.

Question 4

One way in which contract manufacturing is used is for a company to contract with a local manufacturer to produce products for the company,according to the company's specifications.

Accepted Answer

Contract manufacturing is exactly when a company contracts with a local manufacturer to produce products for the company, according to the company's specifications.

Question 5

Licensing refers to a contractual agreement in which the licensor grants access to its patents,trade secrets,or technology for a fee paid by the licensee.

Accepted Answer

Licensing is a contractual agreement where one party (the licensor) grants the other party (the licensee) access to their patents, trade secrets or technology in exchange for a fee or royalty payment.

Question 6

A sales company is established to market goods or services,not to produce them.

Accepted Answer

A sales company's primary focus is on marketing and selling products or services, not on producing them. Production is typically left to the manufacturers or service providers that they contract with or represent.

Question 7

A sales company is part of indirect exporting.

Accepted Answer

The answer of A sales company is part of indirect...

Question 8

The Internet has made direct exporting much easier.

Accepted Answer

The Internet has made it easier for companies to reach potential customers in other countries, communicate with them directly, and conduct transactions. This has greatly facilitated the process of direct exporting, eliminating or reducing some of the traditional barriers, such as distance, language, and cultural differences.

Question 9

Research shows that surviving pioneers hold a smaller average market share when their industries reach maturity than firms that were either fast followers or late entrants in the product category.

Accepted Answer

The answer of Research shows that surviving pioneers hold a...

Question 10

Producing a factory ready to operate is similar to producing a "turnkey project."

Accepted Answer

Producing a factory ready to operate involves completing all necessary construction, installation, and equipment setup so that the factory can begin operations immediately, similar to a turnkey project which involves completing all aspects of a project so that it is ready for immediate use or operation.

Question 11

The licensee generally pays a fix sum when signing a license agreement and then royalties of five to seven percent of sales over the life of the contract.

Accepted Answer

The answer of The licensee generally pays a fix sum...

Question 12

Turnkey projects export technology,management expertise,and capital equipment.

Accepted Answer

Turnkey projects involve exporting technology, management expertise, and capital equipment as a complete package for the establishment of a project in another location.

Question 13

Direct exporting is an excellent means of getting a feel for international business without committing a great amount of human or financial resources.

Accepted Answer

Direct exporting allows a company to test the waters of international business by selling their products directly to foreign customers without the need to establish a physical presence in the target market. This can be a cost-effective and low-risk way to start exporting.

Question 14

The means of supplying overseas markets-exporting to and production in those markets-depend on non-equity modes of entry.

Accepted Answer

The means of supplying overseas markets, such as exporting to and production in those markets, can depend on both equity and nonequity modes of entry. Equity modes include joint ventures and wholly owned subsidiaries, while nonequity modes include exporting, licensing, and franchising.

Question 15

Entering foreign markets may be described by two levels of involvement,non-equity and equity-based.

Accepted Answer

This statement is true. Entering foreign markets can be achieved through non-equity methods such as exporting, licensing, franchising, and contract manufacturing, or through equity-based methods like joint ventures, acquisitions, and wholly-owned subsidiaries.

Question 16

Some evidence suggests that pioneers gain and maintain a competitive advantage in new markets.

Accepted Answer

Pioneers often have the advantage of being the first movers in a new market, allowing them to establish brand recognition, customer loyalty, and distribution channels before competitors enter the market. They may also have access to unique resources or technologies that are not yet available to new entrants. Additionally, pioneers may be able to set market standards and influence regulations, giving them a further advantage over later entrants.

Question 17

Piracy can refer to both high-sea swashbuckling and the illegal appropriation of software,music,video,and other intellectual property.

Accepted Answer

Piracy can refer to both the act of robbing on the high seas as well as the theft or unauthorized use of intellectual property such as software, music, videos, etc.

Question 18

A follower will most likely succeed when there are few legal,technological,cultural,or financial barriers to inhibit entry,as long as it has sufficient resources or competencies to overwhelm the pioneer's early advantage.

Accepted Answer

When there are few legal, technological, cultural, or financial barriers, a follower can quickly and easily enter the market and use their resources or competencies to overcome the pioneer's early advantage. Therefore, a follower is most likely to succeed under these conditions.

Question 19

Some firms do not grant licenses to other firms because of the fear of having a strong competitor upon the expiration of the license.

Accepted Answer

This is a common strategy in business. By not granting licenses to competitors, a firm can maintain its competitive advantage and prevent the creation of strong rivals in the future.

Question 20

A management contract is used only by manufacturing companies to earn income by providing expertise for a fee.

Accepted Answer

A management contract can be used by any company in any industry, not just manufacturing companies. It is a type of contractual agreement in which one party agrees to provide management services to another party for a fee.

Quiz 13: Entry Modes