Exam 13: Selecting and Managing Entry Modes

Scenario: Wang's Techno Toys Ann Wang has been successfully running Wang's Techno Toys that sells high-tech toys in the domestic market.Continually increasing and stiff competition at home has now forced Wang's Techno Toys to enter international markets through direct exports. -Which of the following methods of export/import financing is Techno Toys' bank using if it acts as an intermediary without accepting financial risk?

When one company is hired to design,construct,and test a production facility for a client,the arrangement is called ________.

A ________ is a separate company created and owned by two or more independent entities to achieve a common business objective.

A company proposes that in exchange for a hard-currency sale,it will make a hard-currency purchase of an unspecified product from the buyer nation in the future.Which of the following is the company proposing?

A ________ joint venture is formed when each partner requires the same component in its production process.

Which of the following is a contractual entry mode?

Explain why companies consider exporting.Describe the four-step model of developing a successful export strategy.

Which of the following is the oldest known form of countertrade?

Which of the following requires an importer to pay for the imported goods when they are delivered?

Which of the following is a method of export/import financing in which the importer's bank issues a document stating that the bank will pay the exporter when the exporter fulfills the terms of the document?

Letters of credit are popular among traders because most of the risks are assumed by ________.

A(n)________ exports products on behalf of an indirect exporter.

What is countertrade? Explain the concept of buyback as a type of countertrade,and discuss buyback as a joint venture configuration.

Which of the following is the most common method of buying and selling goods internationally?

Under a turnkey project,one company supplies another with managerial expertise for a specific period of time.

What are the differences between a turnkey project and a strategic alliance?

Scenario: Gro-Tru Grows To Europe Gro-Tru,a maker of chemical fertilizers and pesticides,sees enormous growth potential in Central Europe.The company has received several inquiries from potential importers in the region,but in most cases,the potential importers have expressed difficulty in obtaining the hard currency to pay for Gro-Tru's products.Alistair Green,vice-president for business development,is exploring how Gro-Tru can meet the needs of the potential market. -Which of the following methods would Gro-Tru be implementing if it exchanges its products directly for other goods or services without the use of money?

Most large companies use exporting as a means of expanding total sales when the domestic market has become saturated.

Countertrade is not an option for smaller companies because of the cash outlays involved.

What are the advantages of pursuing a wholly owned subsidiary as an entry strategy?