COB 487 test 3 (All Solved) .

Mode of Entry correct answers -strategic alliance -mergers and acquisitions strategic alliance correct answers Any cooperative effort between two or more independent organizations to develop, manufacture, or sell products or services Motivation for Alliances correct answers -Create economic value by: - An alliance is an organizational form of exchange -Implication create economic value by correct answers -Accessing complementary resources and capabilities -Leveraging existing resources and capabilities An alliance is an organizational form of exchange that correct answers -Should produce a gain from trade due to some comparative or absolute advantage implication correct answers Choose partners that are better at something than you are (complementary resources) Motivations for Alliances correct answers -Suppliers -New Markets -Training -Expertise -Regulatory Three types of Alliances correct answers 1. Nonequity alliance 2. Equity Alliance 3. Joint venture Nonequity Alliance correct answers Contracts -Licensing supply and distribution agreements -formal relationship EX: Disney and Mcdonalds Equity Alliance correct answers Cross Equity Holding -Partners own stakes in each other -own different percentages of the company Ex: Pixar and disney Joint Venture correct answers Joint Equity Holdings -Independent firm is created Ex: Nummi and GM and Toyota How Strategic Alliances create Value correct answers Value Creation