Which term describes a partnership formed by two or more firms to pursue a project for a finite period?

Which term describes a partnership formed by two or more firms to pursue a project for a finite period?

• A. Merger
• B. Acquisition
• C. Joint Venture
• D. Franchise

Answer: (C)

A joint venture is a partnership formed by two or more firms to pursue a project for a finite period. This arrangement brings together resources, expertise, and shared risks for a specific goal, and it typically ends once the project is completed or the agreed term expires, after which the venture is dissolved or reverts to the original firms. This fits the idea of a temporary, project-focused collaboration better than the other options. A merger involves combining two companies into a single new or absorbed entity, usually to create ongoing scale or synergy, not just a temporary project. An acquisition is when one firm takes control of another and absorbs it, again a long-term integration rather than a limited-time alliance. A franchise is a licensing relationship where the franchisee operates a business under the franchisor’s brand and system, continuing indefinitely as a business model rather than pursuing a specific finite project.

A joint venture is a partnership formed by two or more firms to pursue a project for a finite period. This arrangement brings together resources, expertise, and shared risks for a specific goal, and it typically ends once the project is completed or the agreed term expires, after which the venture is dissolved or reverts to the original firms.

This fits the idea of a temporary, project-focused collaboration better than the other options. A merger involves combining two companies into a single new or absorbed entity, usually to create ongoing scale or synergy, not just a temporary project. An acquisition is when one firm takes control of another and absorbs it, again a long-term integration rather than a limited-time alliance. A franchise is a licensing relationship where the franchisee operates a business under the franchisor’s brand and system, continuing indefinitely as a business model rather than pursuing a specific finite project.