BUS 187 Chp 15 Quiz

1. By acquiring an established enterprise, a firm can rapidly 2. Firms will make acquisitions to _______, which is particularly important in markets that are rapidly globalizing 3. Many acquisitions fail because 4. The big advantage of _______ is that it gives the firm a much greater ability to create the kind of organizational culture and operations it wants 5. If a firm is entering a country where there are no incumbent competitors ______ is preferred

1. build its presence in the foreign market 2. preempt competitors 3. anticipated synergies run into roadblocks and take longer than realize than planned 4. a greenfield venture in a foreign country 5. a greenfield venture

Part 2 of 4 An advantage of Uber's strategy of going it alone in foreign markets is

facing little to no competition

T or F: A manufacturer of organic pet food is thinking about expanding into a foreign market. By getting into the market early, before competitors, the company can avoid the pioneering costs that come with entering a market late.

false

T or F: When a firm's competitive advantage is based on technological competence, a wholly owned subsidiary will often be the preferred entry mode because it reduces the risk of losing control over that competence.

false

Part 4 of 4 When choosing which foreign markets to enter, Uber focused on

for potential for local partners

Part 1 of 4 For Starbucks, ________blank is the main advantage of entering new markets like Japan and China via a joint venture.

gaining access to local market knowledge

Part 2 of 4 By buying out its joint venture partners in China and Japan and establishing wholly owned subsidiaries, Starbucks

increases its costs and risk

Part 3 of 4 Despite having experience in Europe and North America, the decision by Starbucks to build its presence in Japan and China via a joint venture with a local partner

reflects recognition by Starbucks of its lack of local market knowledge

Part 4 of 4 Starbucks' decision to buy out its joint venture partner in Japan following several years of operation and instead establish a wholly owned subsidiary

suggests that the company no longer needs the local market expertise of its partner

Part 3 of 4 Uber's rationale of entering foreign markets quickly and worrying about regulations later was related to

the inability of Uber executives to work with foreign market government officials

T or F: Licensing limits a firm's ability to realize experience curve and location economies.

true

T or F: Widgets, Inc., wants to enter a foreign market on a small scale. This will allow the company to learn about the market while limiting the firm's exposure to that market.

true

Part 1 of 4 Uber's strategy for entering foreign markets was to go it alone. Partnering with local companies

was a more expensive strategy that made little financial sense

1. While the present wealth of customers in a national market is an important factor, the firm must also consider living standards and 2. The benefit-cost-risk trade-off is likely to be least favorable in developing nations that operate with a mixed or command economy or where 3. One ______ is the ability to preempt rivals and capture demand by establishing a strong brand name 4. Strategic commitments, like _______, can have an important influence on the nature of competition 5. Small-scale entry gives the firm time to collect information, but it may make it more difficult for the firm to

1. economic growth 2. speculative financial bubbles have led to excess borrowing 3. first-mover advantage 4. rapid large-scale market entry 5. build market share or capture first-mover advantages

1. Shared ownership can result in conflicts for control over direction, strategy, and operations if differences emerge with partners 2. Realize scale economies from sales volume without major costs of manufacturing operations in host country 3. This is the most costly approach from capital investment perspective 4. Earning economic returns from technologically complex processes and know-how when FDI may be restricted 5. Most of the capital to get operations going is not provided by the firm 6. May not be able to take advantage of lower-cost locations for foreign and domestic markets 7. A firm benefits from a local partner's knowledge of the host country's competitive conditions, culture, language, political systems, and business systems. 8. The firm maintains complete control over competencies and operations 9. The firm that enters into a turnkey deal will have no long-term interest in the foreign country 10. Severely limits the firm's ability to realize experience curve and location economies as separate and independent production facilities are set up

1. joint venture 2. exporting 3. wholly owned subsidiary 4. turnkey project 5. licensing 6. exporting 7. joint venture 8. wholly owned subsidiary 9. turnkey project 10. licensing