Supernova Inc. wishes to enter a new market to expand its business. Realizing that the resources within the firm might not be significant to the new market the company has entered into an agreement with Alba Inc. that both the companies will combine their resources and skills to establish and manage a new business unit to serve the new market. Which of the following entry modes has Supernova Inc. adopted? a. Joint ventureb. Joint enterprisec. Joint undertakingd. Joint enterprises

Question

Business

Pickle

8 January, 13:56

Supernova Inc. wishes to enter a new market to expand its business. Realizing that the resources within the firm might not be significant to the new market the company has entered into an agreement with Alba Inc. that both the companies will combine their resources and skills to establish and manage a new business unit to serve the new market. Which of the following entry modes has Supernova Inc. adopted? a. Joint ventureb. Joint enterprisec. Joint undertakingd. Joint enterprises

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Answers (1)

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Kylan Lane · Answer 1

a. Joint venture

Explanation:

A joint venture is the union of knowledge, skills and resources from two or more companies. These companies will also share risk and gains.

Supernova Inc and Alba Inc will keep their company and remain independent. There is no absorbtion or fusion. They will only deal together with the new company in the specific market they agree into for everything else, they are different entities with their own risk, obligation and gains.