Question:Relatively low cost access to new markets; easy access to local capital markets; sharing risks; and being able to use existing local expertise and infrastructure are some of the main advantages of which means of establishing an overseas business interest?
A. Branch
B. Licensing contract
C. Joint Venture
D. Subsidiary
The correct answer is: Joint Venture.
The main advantages of overseas expansion through a joint venture arrangement are:
Relatively low cost access to new markets
Relatively easy access to local capital markets, possibly with accompanying tax incentives or grants
Use of joint venture partner's existing management expertise, local knowledge, distribution network, technology, brands, patents and marketing
Sharing of risks
Sharing of costs, providing economies of scale
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