Question

Outsourcing a part of or entire production and concentrating on marketing operations in international business is known as

(a) Licensing

(b) Franchising

(c) Contract manufacturing

(d) Joint venture

Answer 1

It is under contract manufacturing that a firm outsources the production of its goods and services to foreign firms and concentrates on marketing operations in international business. On the other hand, in the licensing and franchising models, a company grants intellectual property rights to a foreign firm, and in a joint venture, two or more firms pool their resources to launch a new business enterprise.

Hence, the correct answer is option (c).