Question

Write short Answers of the following.

Why is Joint Venture useful?

Answer 1

A joint venture is a business agreement under which two or more organisations come together for mutual benefits and gains. Business organisations in a joint venture share not only the physical, financial and human resources available but also the risks and profits of the business. It leads to joint ownership.

The following points highlight the uses of a joint venture:

i. In a joint venture, the resources and the operational capacities of the two individual organisations are pooled together, which enables them to grow and expand in a better way.

ii. Entering a joint venture with units in different regions widens the market base for each individual enterprise.

iii. New and modern technology can be easily attained, with less amount of investment and effort required at the individual level.