Question

When a company allows a foreign firm to pay it a fee to make or distribute the first company's product or service it is called?

1) outsourcing
2) franchising
3) licensing
4) countertrading
5) a joint venture

Answer 1

When a foreign firm pays a fee to make or distribute a company's product or service, it is called licensing. Licensing allows the foreign firm to use the original company's intellectual property in exchange for a fee.

Step-by-step explanation:

When a foreign firm pays a fee to make or distribute a company's product or service, it is called licensing. Licensing is a business arrangement in which the licensor (the original company) allows a foreign firm (the licensee) to use its intellectual property, such as trademarks, patents, or copyrights, in exchange for a fee. This allows the foreign firm to enter new markets and expand its product or service offerings.