Chapter 11, 12 (Market Entry Strategies)

The most important consideration for a firm expanding into a foreign market is:

• Short-term returns

• The opportunity to cooperate

• The country's long-run revenue potential

• Who is leading the initiative

Two basic strategies (argued by Porter) for improving a firm's profitability are a(n) __________ strategy and a(n) __________ strategy.

• differentiation; low-cost

• marketing; finance

• operations; personnel

• structure; leadership

Countries differ along a range of dimensions including

• Social

• Technological

• Economic

• Political

• All of the above

When orienting themselves toward achieving maximum local responsiveness, firms are seen as pursuing a(n) __________ strategy.

• global

• multidomestic

• international

• alliance

It is most important to consider _______ once attractive markets have been identified.

• the employees involved

• the timing of entry

• core competencies

• home-country language

In which of the following does the contractor agree to handle every detail of the project for a foreign client, including the training of operating personnel?

• Licensing agreement

• Joint venture

• Wholly owned subsidiary

• Turnkey project

What do we call costs that an early entrant has to bear but which a later entrant can avoid?

• pioneering costs

• entry-mode costs

• strategic commitment costs

• business expansion costs

This is an arrangement whereby one party grants the rights to intangible property to another business and receives a royalty fee.

• A joint venture

• A licensing agreement

• A turnkey project

• All of the above

Which of the following is not a reason acquisitions fail?

• Overpaying for the assets of the acquired firm

• Clash between cultures of the firms

• Differences in management philosophy

• Not paying royalty fee

The big advantage of _______ in a foreign country is that it gives the firm a much greater ability to build the kind of subsidiary company that it wants.

• licensing

• establishing a joint venture

• establishing a greenfield venture

• franchising