Concept – Disadvantages of Licensing vs. FDI

Multinational Business Finance

Eiteman, Stonehill, and Moffett

16th Edition

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Which option does NOT represent a potential drawback of licensing when compared to Foreign Direct Investment (FDI)?

A. possible loss of quality control

B. establishment of a potential competitor in third-country markets

C. possible improvement of the technology by the local licensee, which then enters the original firm's home market

D. All of the above are potential disadvantages to licensing.

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  • Search Terms: a. possible a above are area bottom part by competitor content control b. establishment disadvantage disadvantages enters fdi? question firm's following home improvement in is licensee, licensing licensing. local​ loss market d. all markets c. possible not of original​ potential quality relative technology the then thirdcountry to to​ which
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