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Question
eBay, the online auction company, has an impressive portfolio of cooperative agreements. This portfolio includes an agreement with the U.S. Postal Service to facilitate the shipping of goods purchased through eBay auctions, an agreement to allow MBNA to use eBay's name on a credit card, and an agreement in an online auction company in Korea that is supplemented with an investment by eBay in the Korean partner. In addition, at one time eBay had formed an independent firm, called eBay Australia and New Zealand, with an Australian company known as ecorp.Which of the following reasons helps explain why eBay may have preferred to enter into an alliance to enter the Korean online auction industry rather than going it alone?
A) eBay's Korean partner possesses capabilities that are valuable and rare but not costly to imitate.
B) The level of transaction-specific investments required to enter the Korean online auction industry is low.
C) There is little uncertainty about the future of the Korean online auction industry.
D) The level of transaction-specific investments required to enter the Korean online auction industry is moderate.
Answer
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