Question:
Discuss the merits and demerits of entering into joint ventures.
Answer:
Merits of Joint Venture
- Less Expensive: It is.financially less expensive as local producer also makes some contribution in equity capital. Half of the capital is contributed by local producer. It reduces the burden for foreign investor.
- Beneficial for projects requiring Large Scale Investment: It is beneficial for projects requiring large capital investments like construction of metro. In such projects it is generally difficult for a single investor to invest.
- Knowledge about host country: Local producers provide knowledge about host country. It helps the foreign investor to establish its foot in host country.
- Less risky: Risk gets reduced by involving local manufacturer. First, he makes 50% equity and thereby shares losses and other risks. Secondly, he has an understanding of taste and preferences of customers in host country, laws and culture of host country.
Disadvantages of Joint Venture
- Sharing of Technology: In joint venture, foreign firm shares technology with the local producer. It is risky. He may start a business of his own once he gets acquainted with the technology.
- Conflicts: There may be conflicts in managerial decisions as there is dual ownership arrangement.
International Business I
Q 1.
What is the share of India's exports in world exports?
Q 2.
Which mode of international business should be chosen by a small business man and why?
Q 3.
Explain different forms of Joint Ventures.
Q 4.
What are the major items that are exported from India?
Q 5.
Reebok orders for footballs to local manufacturers of Ludhiana and then sells it all over the world. It is an example of what?
Q 6.
Discuss as to why nations trade.
Q 7.
Discuss the scope of international business.
Q 8.
State the important changes being observed in composition of India's external trade since 2007-08.
Q 9.
What are the benefits of international trade to firms?
Q 10.
List the major countries with whom India trades.
Q 11.
Discuss the merits and demerits of entering into joint ventures.
Q 12.
Discuss meaning, merits and demerits of contract manufacturing.
Q 13.
India is_largest economy in the world.
Q 14.
Discuss any three advantages of international business.
Q 15.
When a middleman is involved in handling export procedure, then it is called by what name?
Q 16.
Licensee or franchisee pays a fee to licensor or franchisor. What is it called?
Q 17.
"International trade benefits both the parties involve."Do you agree? Justify your answer:
Q 18.
Which service has got dominating share in foreign trade in services?
Q 19.
Discuss the major trends in India's foreign trade. Also list the major products that India trades with other countries.
Q 20.
What is the basic reason behind international trade?
Q 21.
How is home trade different from external trade?
Q 22.
List major items of India's import.
Q 23.
Write a short note on India's foreign investments.
Q 24.
Why is it said that licensing is an easier way to expand globally?
Q 25.
"Foreign trade is not free from difficulties."Comment.
Q 26.
Give one point of difference between licensing and franchising.
Q 27.
Name the country whose share is largest in India's exports and imports.
Q 28.
What is the major reason under lying trade between nations?
Q 29.
Out of international trade and international business which one is wider in scope?
Q 30.
Discuss meaning, merits and demerits of contract manufacturing.
Q 31.
Enumerate limitations of contract manufacturing.
Q 32.
India embarks on the path of globalisation. Comment
Q 33.
Discuss the benefits of international business.
Q 34.
What benefits do firms derive by entering into international business?
Q 35.
"International business is more than international trade". Comment.
Q 36.
In what ways is exporting a better way of entering into international markets than setting up wholly owned subsidiaries abroad.
Q 37.
"Wholly owned subsidiary is a more investing, more risky and less return giving venture."Do you agree? Substantiate your answer.
Q 38.
Discuss briefly the factors that govern the choice of mode of entry into international business.
Q 39.
Explain different forms of contract manufacturing.
Q 40.
Define international business.
Q 41.
Differentiate between international trade and international business.
Q 42.
What is invisible trade? Discuss salient aspects of India's trade in services.
Q 43.
Differentiate between contract manufacturing and setting up wholly owned production subsidiary abroad.
Q 44.
Distinguish between licensing and franchising.
Q 45.
What is international business? How is it different from domestic business?
Q 46.
Licensing and franchising are suitable in different situations. Explain how?
