Which of the following statements is true in the context of joint ventures?
A)In a joint venture, the bigger of the two companies always takes up complete ownership.
B)The purpose of a joint venture could be to just share access to customers.
C)Joint ventures are most appropriate when a parent company wishes to pursue technology development.
D)Joint ventures eliminate the task of creating a new business model.
E)Joint ventures are less expensive and easier to implement than acquisitions.

Question

Quizplus · Accepted Answer

The purpose of a joint venture can be to share access to resources such as customers, technology, or distribution channels. Joint ventures do not necessarily involve complete ownership by one company. Joint ventures can be a solution when a parent company wishes to pursue opportunities that require collaboration with another firm without the complexity and cost of an acquisition. However, creating a joint venture still requires a business model and legal agreements, so it is not necessarily less expensive or easier to implement than an acquisition.

Which of the Following Statements Is True in the Context