Question 1

Which of the following is an example of an external growth strategy?

Accepted Answer

A)  New product development 
B)  Mergers and acquisitions 
C)  Market penetration 
D)  Product line extension 
E)  Geographic expansion 
A)  New product development 
B)  Mergers and acquisitions 
C)  Market penetration 
D)  Product line extension 
E)  Geographic expansion

Question 2

Qualcomm, a high-tech company headquartered in San Diego, owns the rights to several of the key components that permit cell phones to work. Instead of selling cell phones itself, Qualcomm grants permission to many companies to use specific forms of its intellectual property in exchange for monetary compensation. Qualcomm in engaging in an external growth strategy referred to as ________.

Accepted Answer

A)  licensing 
B)  strategic alliances 
C)  acquisitions 
D)  new product development 
E)  joint ventures 
A)  licensing 
B)  strategic alliances 
C)  acquisitions 
D)  new product development 
E)  joint ventures

Question 3

Nest Labs, Zappos and Sir Kensington's are examples of firms that are growing via ________ growth strategies.

Accepted Answer

A)  in-house 
B)  external 
C)  internal 
D)  central 
E)  derivative 
A)  in-house 
B)  external 
C)  internal 
D)  central 
E)  derivative

Question 4

The Partnering for Success feature in Chapter 14 is titled "Three Steps to Alliance Success." The three steps to alliance success identified in the feature are ________.

Accepted Answer

A)  drafting a licensing agreement, setting up a governance structure, and making it work 
B)  selecting a partner, cutting the deal, and making it work 
C)  interviewing potential partners, cutting the deal, and supervising the implementation of the agreement 
D)  drafting a licensing agreement, cutting the deal, and setting up a governance structure 
E)  selecting an alliance "manager," setting up a governance structure, and making it work 
A)  drafting a licensing agreement, setting up a governance structure, and making it work 
B)  selecting a partner, cutting the deal, and making it work 
C)  interviewing potential partners, cutting the deal, and supervising the implementation of the agreement 
D)  drafting a licensing agreement, cutting the deal, and setting up a governance structure 
E)  selecting an alliance "manager," setting up a governance structure, and making it work

Question 5

________ is the granting of permission by one company to another company to use a specific form of its intellectual property under clearly defined conditions.

Accepted Answer

A)  Verifying 
B)  Confirming 
C)  Endorsing 
D)  Licensing 
E)  Certifying 
A)  Verifying 
B)  Confirming 
C)  Endorsing 
D)  Licensing 
E)  Certifying

Question 6

External growth strategies rely on establishing relationships with third parties, such as mergers, acquisitions, strategic alliances, joint ventures, licensing, and franchising.

Accepted Answer

A) True 
 B)False

Question 7

A(n) ________ is the pooling of interests to combine two or more firms into one. A(n) ________ is the outright purchase of one firm by another.

Accepted Answer

A)  acquisition; merger 
B)  merger; acquisition 
C)  licensing agreement; acquisition 
D)  joint venture; strategic alliance 
E)  strategic alliance; joint venture 
A)  acquisition; merger 
B)  merger; acquisition 
C)  licensing agreement; acquisition 
D)  joint venture; strategic alliance 
E)  strategic alliance; joint venture

Question 8

The majority of entrepreneurial firms first enter foreign markets as exporters.

Accepted Answer

A) True 
 B)False

Question 9

A ________ is a partnership between two or more firms that is developed to achieve a specific goal and has no joint ownership involved.

Accepted Answer

A)  joint alliance 
B)  joint venture 
C)  licensing agreement 
D)  merger 
E)  strategic alliance 
A)  joint alliance 
B)  joint venture 
C)  licensing agreement 
D)  merger 
E)  strategic alliance

Question 10

New product development, other product-related strategies, and international expansion are examples of ________ growth strategies.

Accepted Answer

A)  external 
B)  domestic 
C)  primary 
D)  internal 
E)  in-house 
A)  external 
B)  domestic 
C)  primary 
D)  internal 
E)  in-house

Question 11

Describe what licensing is. What type of intellectual property can be licensed? Identify the two types of licensing pursued by entrepreneurial firms.

Accepted Answer

Licensing is the granting of permission

Question 12

Shelby Collins owns a firm that designs and sells women's clothing. She is currently trying to grow her firm by developing new product lines. Shelby is pursuing a(n) ________ growth strategy.

Accepted Answer

A)  in-house 
B)  center 
C)  domestic 
D)  external 
E)  internal 
A)  in-house 
B)  center 
C)  domestic 
D)  external 
E)  internal

Question 13

Internally generated growth is often-called organic growth because it does not rely on outside intervention.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following is the primary disadvantage of licensing as a foreign market entry strategy?

Accepted Answer

A)  A firm in effect "teaches" a foreign company how to produce its proprietary products. 
B)  High transportation costs 
C)  It is usually a one-time activity. 
D)  A firm loses partial control of its business operations. 
E)  Quality control 
A)  A firm in effect "teaches" a foreign company how to produce its proprietary products. 
B)  High transportation costs 
C)  It is usually a one-time activity. 
D)  A firm loses partial control of its business operations. 
E)  Quality control

Question 15

An acquisition is the pooling of interests to combine two or more firms into one. A merger is the outright purchase of one firm by another.

Accepted Answer

A) True 
 B)False

Question 16

Explain the difference between internal and external growth strategies. Provide examples of each.

Accepted Answer

Internal growth strategies rely on effor

Question 17

Which of the following was NOT identified in Chapter 14 as one of the top five reasons new products fail?

Accepted Answer

A)  The potential market was overestimated. 
B)  Customers saw the product as too expensive. 
C)  Lack of passion for the product. 
D)  The product was no different than the competition's. 
E)  The costs of developing the product line were too high. 
A)  The potential market was overestimated. 
B)  Customers saw the product as too expensive. 
C)  Lack of passion for the product. 
D)  The product was no different than the competition's. 
E)  The costs of developing the product line were too high.

Question 18

An advantage of internal growth is that it is a rapid form of growth.

Accepted Answer

A) True 
 B)False

Question 19

Which of the following is an advantage of internal growth strategies?

Accepted Answer

A)  Need to develop new resources 
B)  Get quality and pricing right 
C)  Investment in a failed internal effort can be difficult to recoup 
D)  Provides maximum control 
E)  Adds to industry capacity 
A)  Need to develop new resources 
B)  Get quality and pricing right 
C)  Investment in a failed internal effort can be difficult to recoup 
D)  Provides maximum control 
E)  Adds to industry capacity

Question 20

________ licensing is the licensing of proprietary technology that the licensor typically controls by virtue of a utility patent.

Accepted Answer

A)  Skill 
B)  Intellectual property 
C)  Utility 
D)  Technology 
E)  Expertise 
A)  Skill 
B)  Intellectual property 
C)  Utility 
D)  Technology 
E)  Expertise

Which of the following is an example of an external growth strategy?

Nest Labs, Zappos and Sir Kensington's are examples of firms that are growing via ________ growth strategies.

The Partnering for Success feature in Chapter 14 is titled "Three Steps to Alliance Success." The three steps to alliance success identified in the feature are ________.

________ is the granting of permission by one company to another company to use a specific form of its intellectual property under clearly defined conditions.

External growth strategies rely on establishing relationships with third parties, such as mergers, acquisitions, strategic alliances, joint ventures, licensing, and franchising.

A(n) is the pooling of interests to combine two or more firms into one. A(n) is the outright purchase of one firm by another.

The majority of entrepreneurial firms first enter foreign markets as exporters.

A ________ is a partnership between two or more firms that is developed to achieve a specific goal and has no joint ownership involved.

New product development, other product-related strategies, and international expansion are examples of ________ growth strategies.

Describe what licensing is. What type of intellectual property can be licensed? Identify the two types of licensing pursued by entrepreneurial firms.

Shelby Collins owns a firm that designs and sells women's clothing. She is currently trying to grow her firm by developing new product lines. Shelby is pursuing a(n) ________ growth strategy.

Internally generated growth is often-called organic growth because it does not rely on outside intervention.

Which of the following is the primary disadvantage of licensing as a foreign market entry strategy?

An acquisition is the pooling of interests to combine two or more firms into one. A merger is the outright purchase of one firm by another.

Explain the difference between internal and external growth strategies. Provide examples of each.

Which of the following was NOT identified in Chapter 14 as one of the top five reasons new products fail?

An advantage of internal growth is that it is a rapid form of growth.

Which of the following is an advantage of internal growth strategies?

________ licensing is the licensing of proprietary technology that the licensor typically controls by virtue of a utility patent.

Introduction to Entrepreneurship

Recognizing Opportunities and Generating Ideas

Feasibility Analysis

Developing an Effective Business Model

Industry and Competitor Analysis

Writing a Business Plan

Preparing the Proper Ethical and Legal Foundation

Assessing a New Ventures Financial Strength and Viability

Building a New-Venture Team

Getting Financing or Funding

Unique Marketing Issues

The Importance of Intellectual Property

Preparing for and Evaluating the Challenges of Growth

Franchising

Filters

Exam 14: Strategies for Firm Growth

Which of the following is an example of an external growth strategy?

Nest Labs, Zappos and Sir Kensington's are examples of firms that are growing via ________ growth strategies.

The Partnering for Success feature in Chapter 14 is titled "Three Steps to Alliance Success." The three steps to alliance success identified in the feature are ________.

________ is the granting of permission by one company to another company to use a specific form of its intellectual property under clearly defined conditions.

External growth strategies rely on establishing relationships with third parties, such as mergers, acquisitions, strategic alliances, joint ventures, licensing, and franchising.

A(n) ________ is the pooling of interests to combine two or more firms into one. A(n) ________ is the outright purchase of one firm by another.

The majority of entrepreneurial firms first enter foreign markets as exporters.

A ________ is a partnership between two or more firms that is developed to achieve a specific goal and has no joint ownership involved.

New product development, other product-related strategies, and international expansion are examples of ________ growth strategies.

Describe what licensing is. What type of intellectual property can be licensed? Identify the two types of licensing pursued by entrepreneurial firms.

Shelby Collins owns a firm that designs and sells women's clothing. She is currently trying to grow her firm by developing new product lines. Shelby is pursuing a(n) ________ growth strategy.

Internally generated growth is often-called organic growth because it does not rely on outside intervention.

Which of the following is the primary disadvantage of licensing as a foreign market entry strategy?

An acquisition is the pooling of interests to combine two or more firms into one. A merger is the outright purchase of one firm by another.

Explain the difference between internal and external growth strategies. Provide examples of each.

Which of the following was NOT identified in Chapter 14 as one of the top five reasons new products fail?

An advantage of internal growth is that it is a rapid form of growth.

Which of the following is an advantage of internal growth strategies?

________ licensing is the licensing of proprietary technology that the licensor typically controls by virtue of a utility patent.

Introduction to Entrepreneurship

Recognizing Opportunities and Generating Ideas

Feasibility Analysis

Developing an Effective Business Model

Industry and Competitor Analysis

Writing a Business Plan

Preparing the Proper Ethical and Legal Foundation

Assessing a New Ventures Financial Strength and Viability

Building a New-Venture Team

Getting Financing or Funding

Unique Marketing Issues

The Importance of Intellectual Property

Preparing for and Evaluating the Challenges of Growth

Franchising

Filters

A(n) is the pooling of interests to combine two or more firms into one. A(n) is the outright purchase of one firm by another.