MAN4720 FINAL EXAM - FSU DEVER -
GO NOLES
Merger - ANSWER-A strategy through which two firms agree to integrate their
operations on a relatively coequal basis.
Acquisition - ANSWER-A strategy through which one firm buys a controlling, or 100
percent, interest in another firm with the intent of making the acquired firm a subsidiary
business within its portfolio.
Takeover - ANSWER-A special type of acquisition where the target firm does not solicit
the acquiring firm's bid; unfriendly acquisitions.
Vertical Acquisition - ANSWER-Refers to a firm acquiring a supplier or distributor of one
or more of its products. The newly formed firm controls additional parts of the value
chain which is how this leads to increased market power.
Leveraged Buyout - ANSWER-Is a restructuring strategy whereby a party (typically a
private equity firm) buys all of a firm's assets in order to take the firm private.
International Strategy - ANSWER-Is a strategy through which the firm sells its goods or
services outside its domestic market.
Exporting - ANSWER-Is an entry mode through which the firm sends products it
produces in its domestic market to international markets. This is a popular entry mode
choice for small businesses to initiate an international strategy.
Licensing - ANSWER-Is an entry mode in which an agreement is formed that allows a
foreign company to purchase the right to manufacture and sell a firm's products within a
host country's market or a set of host countries' markets.
Strategic Alliance - ANSWER-Is a cooperative strategy in which firms combine some of
their resources to create a competitive advantage. a strategic alliance finds a firm
collaborating with another company in a different setting in order to enter one or more
international markets.
Acquisitions on an International Basis - ANSWER-When a firm acquires another
company to enter an international market, it has completed a cross-border acquisition.
A cross-border acquisition is an entry mode through which a firm from one country
acquires a stake in or purchases all of a firm located in another country
, Cooperative Strategy - ANSWER-Is a means by which firms collaborate to achieve a
shared objective.
Joint Venture - ANSWER-Is a strategic alliance in which two or more firms create a
legally independent company to share some of their resources to create a competitive
advantage.
Equity Strategic Alliance - ANSWER-Is an alliance in which two or more firms own
different percentages of the company they have formed by combining some of their
resources to create a competitive advantage.
Non-Equity Alliance - ANSWER-Is an alliance in which two or more firms develop a
contractual relationship to share some of their resources to create a competitive
advantage.
Agency Relationship - ANSWER-Exists when one party delegates decision-making
responsibility to a second party for compensation.
Managerial Opportunism - ANSWER-Is the seeking of self-interest with guile (i.e.,
cunning or deceit). Opportunism is both an attitude (i.e., an inclination) and a set of
behaviors
Agency Costs - ANSWER-Are the sum of incentive costs, monitoring costs,
enforcement costs, and individual financial losses incurred by principals because
governance mechanisms cannot guarantee total compliance by the agent.
Large Block Shareholders - ANSWER-Typically own at least 5 percent of a company's
issued shares.
Vertical Complementary Strategic Alliance - ANSWER-Firms share some of their
resources from different stages of the value chain for the purpose of creating a
competitive advantage.
Sometimes are formed to adapt to environmental changes; sometimes the changes
represent an opportunity for partnering firms to innovate while adapting.
Horizontal Complimentary Strategic Alliance - ANSWER-Is an alliance in which firms
share some of their resources from the same stage (or stages) of the value chain for the
purpose of creating a competitive advantage.
Automobile manufacturers make frequent use of this type of alliance, as do
pharmaceutical companies.
Franchising - ANSWER-is a strategy in which a firm (the franchisor) uses a franchise as
a contractual relationship to describe and control the sharing of its resources with its
partners (the franchisees).
GO NOLES
Merger - ANSWER-A strategy through which two firms agree to integrate their
operations on a relatively coequal basis.
Acquisition - ANSWER-A strategy through which one firm buys a controlling, or 100
percent, interest in another firm with the intent of making the acquired firm a subsidiary
business within its portfolio.
Takeover - ANSWER-A special type of acquisition where the target firm does not solicit
the acquiring firm's bid; unfriendly acquisitions.
Vertical Acquisition - ANSWER-Refers to a firm acquiring a supplier or distributor of one
or more of its products. The newly formed firm controls additional parts of the value
chain which is how this leads to increased market power.
Leveraged Buyout - ANSWER-Is a restructuring strategy whereby a party (typically a
private equity firm) buys all of a firm's assets in order to take the firm private.
International Strategy - ANSWER-Is a strategy through which the firm sells its goods or
services outside its domestic market.
Exporting - ANSWER-Is an entry mode through which the firm sends products it
produces in its domestic market to international markets. This is a popular entry mode
choice for small businesses to initiate an international strategy.
Licensing - ANSWER-Is an entry mode in which an agreement is formed that allows a
foreign company to purchase the right to manufacture and sell a firm's products within a
host country's market or a set of host countries' markets.
Strategic Alliance - ANSWER-Is a cooperative strategy in which firms combine some of
their resources to create a competitive advantage. a strategic alliance finds a firm
collaborating with another company in a different setting in order to enter one or more
international markets.
Acquisitions on an International Basis - ANSWER-When a firm acquires another
company to enter an international market, it has completed a cross-border acquisition.
A cross-border acquisition is an entry mode through which a firm from one country
acquires a stake in or purchases all of a firm located in another country
, Cooperative Strategy - ANSWER-Is a means by which firms collaborate to achieve a
shared objective.
Joint Venture - ANSWER-Is a strategic alliance in which two or more firms create a
legally independent company to share some of their resources to create a competitive
advantage.
Equity Strategic Alliance - ANSWER-Is an alliance in which two or more firms own
different percentages of the company they have formed by combining some of their
resources to create a competitive advantage.
Non-Equity Alliance - ANSWER-Is an alliance in which two or more firms develop a
contractual relationship to share some of their resources to create a competitive
advantage.
Agency Relationship - ANSWER-Exists when one party delegates decision-making
responsibility to a second party for compensation.
Managerial Opportunism - ANSWER-Is the seeking of self-interest with guile (i.e.,
cunning or deceit). Opportunism is both an attitude (i.e., an inclination) and a set of
behaviors
Agency Costs - ANSWER-Are the sum of incentive costs, monitoring costs,
enforcement costs, and individual financial losses incurred by principals because
governance mechanisms cannot guarantee total compliance by the agent.
Large Block Shareholders - ANSWER-Typically own at least 5 percent of a company's
issued shares.
Vertical Complementary Strategic Alliance - ANSWER-Firms share some of their
resources from different stages of the value chain for the purpose of creating a
competitive advantage.
Sometimes are formed to adapt to environmental changes; sometimes the changes
represent an opportunity for partnering firms to innovate while adapting.
Horizontal Complimentary Strategic Alliance - ANSWER-Is an alliance in which firms
share some of their resources from the same stage (or stages) of the value chain for the
purpose of creating a competitive advantage.
Automobile manufacturers make frequent use of this type of alliance, as do
pharmaceutical companies.
Franchising - ANSWER-is a strategy in which a firm (the franchisor) uses a franchise as
a contractual relationship to describe and control the sharing of its resources with its
partners (the franchisees).
