Question

Which is the preferred strategy when a company's competitive advantage is based on technology and the company wishes to enter the global marketplace?

Answer 1

Answer:

The correct answer is letter "E": creating a wholly owned subsidiary.

Explanation:

A Subsidiary is a corporation owned 50% or more by another corporation. The owning corporation is usually called the parent or holding company. A company that is 100% owned and controlled by a parent company is called a wholly-owned subsidiary. The benefit of working with a wholly-owned subsidiary is that the parent takes full control of the operations of the organization, just like in the parent branch which ensures all the processes and strategies of the firms will be applied in the subsidiary.

Technology companies tend to adopt the wholly-owned subsidiary strategy to make sure they do not lose control over their technological products.