MGT 498 Wk4 Study Guide Test.
Crimson Corp., a painting unit, collaborates with a car manufacturing company. They sign a contract that
specifies the tasks of each party in alliance. Which of the following is being exemplified in this scenario? - CORRECT ANSWER A nonequity alliance
Sepia Inc., a fertilizer company, needs permission to test its new products on plantations owned by an agro-based industry. In return, the company is willing to pay a percentage of revenue to the agro-based industry. In this case, which of the following contractual alliances should be adopted by Sepia? - CORRECT ANSWER A licensing agreement
John requires 500 shirts of a particular fabric and quality. He partners with Loumang Inc., a fabric manufacturing company, to develop certain customized inputs. Which of the following is being exemplified in this scenario? - CORRECT ANSWER A supply agreement
Velara Inc., a healthcare company, owns 35% stake in the firm that supplies most of its raw materials. This encourages the supplier to align its incentives with Velara's needs. Which of the following is being exemplified in this case? - CORRECT ANSWER An equity alliance
Borpon Inc. and Biocolog Corp. are well-established biotechnology companies. They enter into a strategic alliance in which they create and own a legally independent company. The new company is created from resources and assets contributed by the parent firms. Revenues, expenses, and profits are equally shared by both firms. Which of the following strategic alliances is adopted by Borpon and Biocolog? - CORRECT ANSWER A joint venture
An organization enters into an alliance with a firm that is positioned at a different stage along the value chain. The alliance is formed to combine unique resources and lower transaction costs. In this case, which of the following alliances has been adopted by the organization? - CORRECT ANSWER A vertical alliance
Two organizations, Purple Inc. and Spring Corp., are positioned at a common stage of the value chain. However, they do not have a supplier-buyer relationship. They form an alliance to benefit from complementary activities. Which of the following is exemplified in this scenario? - CORRECT ANSWER A horizontal alliance Two firms that produce industrial machinery decide to form a strategic alliance. The objective of this collaboration is to combine their manufacturing facilities to achieve economies of scale during production. Which of the following is the primary value they aim to create through this alliance? - CORRECT ANSWER Pooling similar resources
_____ occurs when one partner tries to exploit the alliance-specific investments made by another partner. - CORRECT ANSWER Hold-up
_____ occurs when one partner in an alliance creates false expectations about the resources it brings to the relationship or fails to deliver what it originally promised. - CORRECT ANSWER Misrepresentation
An alliance is likely to rely most on relationships between individuals when it is based on _____. - CORRECT ANSWER goodwill trust
_____ are governance clauses in which parties often specify how profits or assets created from alliances are to be split among partners. - CORRECT ANSWER Residual rights clauses
_____ are governance clauses in which joint ventures must specify what percentage of equity is owned by each of the partners. - CORRECT ANSWER Equity clauses
Nina, a marketing student, studies how people from different countries accept ambiguity or follow rules and laws. When she focuses on this specific trait while studying the distance between a domestic and foreign market, she is likely to be focusing on the markets' _____. - CORRECT ANSWER cultural distance
Blue Corp., a car manufacturing company, reaches its five-year goal of becoming market leader in the domestic market. Upon reaching saturation in the local market, it decides to expand its market globally in order to increase its profits. Which of the following is likely to be the primary reason for Blue to enter the global market? - CORRECT ANSWER Sales growth
Karl Jahaz Corp., an automobile company, has many business units across the globe. Although the company has reached saturation in the domestic market, it continues to generate substantial revenue by selling its old-model, light commercial vehicles in a few countries. In this case, which of the following is achieved by the globalization of the company? - CORRECT ANSWER Extension of product's life cycle
Crimson Corp., a painting unit, collaborates with a car manufacturing company. They sign a contract that
specifies the tasks of each party in alliance. Which of the following is being exemplified in this scenario? - CORRECT ANSWER A nonequity alliance
Sepia Inc., a fertilizer company, needs permission to test its new products on plantations owned by an agro-based industry. In return, the company is willing to pay a percentage of revenue to the agro-based industry. In this case, which of the following contractual alliances should be adopted by Sepia? - CORRECT ANSWER A licensing agreement
John requires 500 shirts of a particular fabric and quality. He partners with Loumang Inc., a fabric manufacturing company, to develop certain customized inputs. Which of the following is being exemplified in this scenario? - CORRECT ANSWER A supply agreement
Velara Inc., a healthcare company, owns 35% stake in the firm that supplies most of its raw materials. This encourages the supplier to align its incentives with Velara's needs. Which of the following is being exemplified in this case? - CORRECT ANSWER An equity alliance
Borpon Inc. and Biocolog Corp. are well-established biotechnology companies. They enter into a strategic alliance in which they create and own a legally independent company. The new company is created from resources and assets contributed by the parent firms. Revenues, expenses, and profits are equally shared by both firms. Which of the following strategic alliances is adopted by Borpon and Biocolog? - CORRECT ANSWER A joint venture
An organization enters into an alliance with a firm that is positioned at a different stage along the value chain. The alliance is formed to combine unique resources and lower transaction costs. In this case, which of the following alliances has been adopted by the organization? - CORRECT ANSWER A vertical alliance
Two organizations, Purple Inc. and Spring Corp., are positioned at a common stage of the value chain. However, they do not have a supplier-buyer relationship. They form an alliance to benefit from complementary activities. Which of the following is exemplified in this scenario? - CORRECT ANSWER A horizontal alliance Two firms that produce industrial machinery decide to form a strategic alliance. The objective of this collaboration is to combine their manufacturing facilities to achieve economies of scale during production. Which of the following is the primary value they aim to create through this alliance? - CORRECT ANSWER Pooling similar resources
_____ occurs when one partner tries to exploit the alliance-specific investments made by another partner. - CORRECT ANSWER Hold-up
_____ occurs when one partner in an alliance creates false expectations about the resources it brings to the relationship or fails to deliver what it originally promised. - CORRECT ANSWER Misrepresentation
An alliance is likely to rely most on relationships between individuals when it is based on _____. - CORRECT ANSWER goodwill trust
_____ are governance clauses in which parties often specify how profits or assets created from alliances are to be split among partners. - CORRECT ANSWER Residual rights clauses
_____ are governance clauses in which joint ventures must specify what percentage of equity is owned by each of the partners. - CORRECT ANSWER Equity clauses
Nina, a marketing student, studies how people from different countries accept ambiguity or follow rules and laws. When she focuses on this specific trait while studying the distance between a domestic and foreign market, she is likely to be focusing on the markets' _____. - CORRECT ANSWER cultural distance
Blue Corp., a car manufacturing company, reaches its five-year goal of becoming market leader in the domestic market. Upon reaching saturation in the local market, it decides to expand its market globally in order to increase its profits. Which of the following is likely to be the primary reason for Blue to enter the global market? - CORRECT ANSWER Sales growth
Karl Jahaz Corp., an automobile company, has many business units across the globe. Although the company has reached saturation in the domestic market, it continues to generate substantial revenue by selling its old-model, light commercial vehicles in a few countries. In this case, which of the following is achieved by the globalization of the company? - CORRECT ANSWER Extension of product's life cycle
