International Business: The Challenge of Global Competition 13th Edition

Chapter 18 - International Accounting and Financial Management Answers Questions 1. The cultural analysis of accounting Gray presents suggests that transparency is the result of a cultural characteristic of some countries and secrecy of others. Could the same attributes be explained by the hypothesis that transparent cultures are less trusting and need the transparency to satisfy

CHAPTER 18 1 International Accounting and Financial Management 2 Learning Objectives LO18-1 Identify the major international accounting issues that international firms face, operating in foreign currencies. LO18-2 Describe the relationship between accounting and culture LO18-3 Describe the international accounting standards convergence process and its im- portance to international firms. LO18-4 Outline the arguments for and

Chapter 01 - The Challenging World of International Business Answers to End of Chapter Questions 1. What are the differences among multidomestic, global, and international companies? A global company attempts to standardize and integrate operations worldwide, whereas a multidomestic is an organization with multi-country affiliates, each of which formulates its own business strategy based

CHAPTER 1 The Challenging World of International Business Learning Objectives LO1-1 Understand what international business is and why it is important. LO1-2 Comprehend why and how international business differs from domestic business. LO1-3 Appreciate that international business has a long and important history in the worlds development. LO1-4 Appreciate the dramatic internationalization of

Chapter 10 - Organizational Design and Control Answers to End of Chapter Questions 1. Why is organizational structure an important issue for international companies? Organizational structure integrates the organization. It is the way jobs are grouped and their reporting relationships established. It also provides information conduits for the data neededfor decision-making. reporting relationships established.

CHAPTER 10 1 Organizational Design and Control 2 Learning Objectives 3LO10-1 Explain why the design of organizational structure is important to international companies. 4LO10-2 Discuss the organizational dimensions that must be considered when selecting organizational structures. 5LO10-3 Discuss the various organizational forms available for structuring international companies. 6LO10-4 Explain why decisions are made where

Chapter 11 - Global Leadership Issues and Practices Answers to Questions 1. What is a global mindset and why is it important for international companies? Global mindset is defined as one that combines an openness to and awareness of diversity across cultures and markets with a propensity and ability to synthesize across this

CHAPTER 11 Global Leadership Issues and Practices Learning Objectives LO11-1 Discuss the importance of creating a company global mindset. LO11-2 Describe what distinguishes the practice of global leadership from its domestic counterpart. LO11-3 Identify the competencies required for effective global leadership. LO11-4 Discuss approaches for selecting and developing effective global leaders. LO11-5 Explain what

Answers to Questions 1. Select a country and a product that you believe your firm can market there. Make a list of the sources of information you will use for each screening. Sources are found in the Global path Ahead, Chapters 12 and 14. 2. What is the basis for the order of

CHAPTER 12 1Assessing International Markets 2 3 Learning Objectives 4 LO1 Discuss environmental analysis and two types of market screening. 5 LO2 Explain market indicators and market factors. 6 LO3 Describe some statistical techniques for estimating market demand and grouping similar markets. 7 LO4 Discuss the value to businesspeople of trade missions and trade fairs. 8 LO5

Chapter 13 - Entry Modes Answers to End of Chapter Questions 1. If a company wanted to be a pioneer for entering a market, what conditions might increase the likelihood of success? If the company wanted to instead be a fast follower, what would be different in terms of the conditions that

CHAPTER 13 1 Entry Modes 2 Learning Objectives 3LO 13-1 Explain the pros and cons of entering markets as a market pioneer versus being a fast follower. 4LO 13-2 Explain the international market entry methods. 5LO 13-3 Identify why firms export and the options available for indirect and direct exporting. 6LO 13-4 Explain

Chapter 14 - Export and Import Practices Answers to Questions 1. In exporting, to what point does the seller pay transportation and delivery costs? Where does the responsibility for loss or damage pass to the buyer? Use Incoterms in your response. The possible responses to the question are summarized in Fig. 14.1. The seller

CHAPTER 14 Export and Import Practices 1 Learning Objectives LO14-1 identify the sources of export counseling and support LO14-2 discuss the meaning of the various terms of sale known as Incoterms LO14-3 identify some sources of export financing LO14-4 describe the activities of a foreign freight forwarder LO14-5 outline the export

Chapter 15 - Marketing Internationally 1 Answers to Questions 1. Louis Vitton CEO Yves Carcelle says, One to two thousand people is all you need. You cant judge by average income-average doesnt mean anything. Although he was speaking about the luxury goods market, do his comments about averages apply to other segments

CHAPTER 15 1 Marketing Internationally 2Learning Objectives 3LO15-1 explain why there are differences between domestic and international marketing 4LO15-2 discuss why international marketing managers may wish to standardize the marketing mix 5LO15-3 explain why it is often impossible to standardize the marketing mix worldwide 6LO15-4 discuss the importance of distinguishing among

Chapter 16 - Global Operations and Supply Chain Management Answers to End of Chapter Questions 1. What recent developments have caused supply chain management to become increasingly important to international companies? Individual businesses no longer operate in a vacuum and are forced to compete with businesses from around the globe. For this reason

CHAPTER 16 1 Global Operations and Supply Chain Management 2 Learning Objectives 3LO 16-1 Understand the concept of supply chain management. 4LO 16-2 Recognize the relationship between design and supply chain management. 5LO 16-3 Describe the five global sourcing arrangements. 6LO 16-4 Understand the increasing role of electronic purchasing for global sourcing.

CHAPTER 17 1 Managing Human Resources in an International Context 2 Learning Objectives 3LO 17-1 Discuss several of the major factors that may affect the quantity and quality of labor in a nation. 4LO 17-2 Explain the relationship between competitive strategies (international, multidomestic, global, and transnational) and international human resource management approaches (ethnocentric, polycentric,

Chapter 02 - International Trade and Foreign Direct Investment Answers to End of Chapter Questions 1. How has trade in merchandise and services changed over the past decade? What have been the major trends? How might this information be of value to a manager? The volume of international trade in merchandise and services

CHAPTER 2 International Trade and Foreign Direct Investment Learning Objectives LO2-1 Appreciate the magnitude of international trade and how it has grown. LO2-2 Identify the direction of trade, or who trades with whom, and trends in such trade. LO2-3 Outline the theories that attempt to explain why certain goods are traded

Chapter 03 - International Institutions from an International Business Perspective Answers to Questions 1. What are the characteristics of informal cognitive institutions and why are they of special significance to international business managers? Cognitive institutions use shared ideas to define reality by means of conceptual frameworks or schema. Examples in the text included the

CHAPTER 3 International Institutions from an International Business Perspective Learning Objectives LO3-1 Explain the importance of international institutions to business decision makers and their firms. LO3-2 Describe the various types of institutions, drawing on institutional theory. LO3-3 Outline the United Nations as an institution and its relevance to international business. LO3-4 Describe the

Chapter 04 - Sociocultural Forces Answers to Questions 1. Drawing on Hall's High and Low Context, describe some of the communication issues that might well arise when an Arab company officer who has spent his career in the Middle East is sent on temporary assignment to Germany for a year to integrate a process

CHAPTER 4 Sociocultural Forces Learning Objectives LO4-1 Describe what culture is. LO4-2 Explain the significance of national-level culture differences for international business. LO4-3 Describe Halls concept of high and low context. LO4-4 Describe Hofstedes framework. LO4-5 Outline Trompenaars dimensions. LO4-6 Discuss the sociocultural aspects of culture as a phenomenon. NOTE: International

Chapter 05 - Natural Resources and Environmental Sustainability Answers to Questions 1. Of the 38 nations listed by the UN as the least developed nations in the world, 16 are landlocked. How might being landlocked contribute to slower development? Remember that Switzerland is landlocked as you think through this question. The lack of a seacoast

CHAPTER 5 Natural Resources and Environmental Sustainability Learning Objectives LO5-1 Describe how geographical features of a country or region create contextual differences that contribute to economic, cultural, political, and social conditions important to international business. LO5-2 Apply Porter's diamond model to a discussion of geographical features. LO5-3 Summarize the importance to business of inland

Chapter 06 - Political and Trade Forces XI. End of Chapter Questions 1. Why might governments nationalize firms, and why might a government-owned firm have an unfair advantage over privately owned companies? Governments put their hands on firms for a number of reasons. Some of these reasons are (1) to extract more

CHAPTER 6 Political and Trade Forces Learning Objectives LO 6-1 Discuss nationalization and privatization of business. LO 6-2 Explain what terrorism is and the range of activities that terrorists can engage in, as well as countermeasures that companies and their employees might take. LO 6-3 Evaluate the importance to business of

Chapter 07 - Intellectual Property and Other Legal Forces Answers to End of Chapter Questions 1.What is the significance of determining whether a country follows the rule of law? Investors, particularly foreigners, need assurance that their civil and property rights will be protected. It is desirable that a country bases its functions on the

CHAPTER 7 Intellectual Property and Other Legal Forces Learning Objectives LO 7-1 Discuss the complexity of the legal forces that confront international business LO 7-2 Explain possibilities for international dispute settlement LO 7-3 Recognize the need and methods to protect intellectual property LO 7-4 Explain the risk of product liability legal actions

Chapter 08 - The International Monetary System and Financial Forces Questions 1. Briefly outline the advantages and disadvantages of the gold system. The gold system is simple, imposes monetary discipline on nations, and is widely trusted. On theother hand, gold is unwieldy, especially with large trade flows, it has holding costs and securitycosts,

CHAPTER 8 The International Monetary System and Financial Forces Learning Objectives LO8-1 Describe the international monetary systems evolution LO8-2 Explain the Trin paradox LO8-3 Describe the oating currency exchange rate system, including the IMF currency arrangements LO8-4 Discuss the purpose of the Bank for International Settlements LO8-5 Explain the impact of fluctuating currency values

Chapter 9 - International Competitive Strategy Answers to End of Chapter Questions 1. What is international strategy, and why is it important? International strategy is concerned with the way firms make fundamental choices about developing and deploying scarce resources internationally. The goal of international strategy is to achieve competitive advantage, and that is

CHAPTER 9 1 International Competitive Strategy 2 Learning Objectives 3LO 9-1 Explain international strategy, competencies, and international competitive advantage. 4LO 9-2 Describe the steps in the global strategic planning process. 5LO 9-3 Explain the purpose of mission statements, vision statements, values statements, objectives, quantified goals, and strategies. 6LO 9-4 Explain home replication, multidomestic,

In a 12-country study conducted by Ernst & Young, 65 percent of U.S. companies were found to be engaged in a strategic alliance. FALSEIn a 12-country study conducted by Ernst & Young, 65 percent of non-U.S. companies and 75 percent of U.S. companies were found to be engaged in a strategic

The sales agreement should specify as simply as possible the duties of the representative and the firm. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. According to the text, Zara's strategy of speed and flexibility has enabled the company to eliminate

In the United States, punitive damage rulings have no measureable effect on medicine. FALSEJust the oppositeoften medical equipment and drug companies will not sell in the UnitedStates because they cannot obtain product liability insurance. FALSEJust the oppositeoften medical equipment and drug companies will not sell in the UnitedStates because they cannot

Although international firms maintain manufacturing facilities in countries at various levels of development, manufacturing systems should not vary significantly within the same company. FALSESince international firms maintain manufacturing facilities in countries at various levels of development, it is understandable that manufacturing systems will also vary significantly, even within the same company.

The EU is a supranational body that has become, essentially, a regional government. TRUEThe EU operates as a regional government in some areas, increasingly in foreign affairs, security, and justice. TRUEThe EU operates as a regional government in some areas, increasingly in foreign affairs, security, and justice. TRUE The EU operates as

In some cases, an international company legally can keep more profit after taxes by allocating work and prices. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. Corporate anthropology refers to the process of obtaining market research data through focus groups and

Laws governing transactions of individuals and companies that cross international borders are: A. none of B, C, D, or E. B. private international law. C. product liability law. D. public international law. E. customary law. B.Private international law includes laws governing the transactions of individuals and companies crossing international borders. B.Private international law includes laws governing the

College students may make good interviewers for firms doing market research in foreign countries. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. Once in export markets, new exporters tend to maintain their focus on them, despite what is happening in the

Advertisers have followed glocalization to reduce costs, enabling them to develop a common strategy for large regions. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. For the conservative international firm, there is no reason to move money other than the repatriation of

Human resources are influenced by cultural values because values are the foundation of motivation and evaluation. TRUEHuman resources are influenced by cultural values. TRUEHuman resources are influenced by cultural values. TRUE Human resources are influenced by cultural values. Finance is best left decentralized in international firms so that local efficiencies and opportunities can

ASEAN, whose initial goal was political, to foster peaceful relations among members, includes China as its core member. FALSEThe initial formation of ASEAN was an effort to combat the spread of communism. China is not a member, although there is a trade-related affiliation between ASEAN and China called ASEAN+3, China, Japan,

The main transportation artery of Europe is the: A. Venice canal system. B. Danube-Dresden waterway. C. Lake Constantine system. D. Rhine waterway. D.Unlike other waterways, whose importance has diminished relative to roads and railroads, the Rhine waterway's importance is increasing. It is the world's most important inland waterway system.Refer To: Figure 5.10, map of the

Strategic business units are an organizational form in which geographic divisions have been defined as though they were distinct, independent businesses. FALSEStrategic business units are an organizational form in which product divisions have been defined as though they were distinct, independent businesses. FALSEStrategic business units are an organizational form in which

Benefits of trade fairs include sales, making contacts with prospective buyers and agents, and competitive intelligence. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. Swap contracts exchange foreign currency debt for another liability in the home currency. FALSESwaps are agreements to exchange

Formal institutions operate through laws and regulations. They require members to make a written commitment. FALSEFormal institutions operate through laws and regulations. Compliance is gained through the threat of coercion; that is, following the rules is expedient.Refer To: Figure 3.1, Institutions: Characteristics FALSEFormal institutions operate through laws and regulations. Compliance is

New types of dumping include concession dumping. FALSENew types of dumping do not include concessions (granted to business to encourage local commitments, such as tax-free periods and local infrastructure). They do include social, environmental, financial services, cultural, and tax dumping. FALSENew types of dumping do not include concessions (granted to business

Manufacturing rationalization is: A. the allocation of scarce resources. B. the division of production among several subsidiaries so that each produces only a limited number of components for all subsidiaries. C. the concentration of production at one site to get economies of scale. D. the production by a subsidiary for its own national market. B.As

The international Fisher effect states that the interest rate differentials for any two currencies reflect the expected change in their exchange rates. TRUEThe international Fisher effect connects exchange rates with interest rates. For example, if the nominal interest rate in the United States is 5 percent and in the EU is

The International Court of Justice (ICJ) handles all cases brought forward by any person or organization. FALSEOnly national governments bring cases. Of course, national governments can bring up claims made by businesses, but the government brings the complaint. FALSEOnly national governments bring cases. Of course, national governments can bring up claims

Trompenaars' achievement vs. ascription dimension describes social status based on what one does or who one is. The United States is a culture in which people build who they are through work, so its social status tends to be based on ascription. FALSEAscription is status based on who you are, not

There is a trend toward treating third-country nationals the same as home-country expatriates in terms of their compensation plans. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. The unspoken language cannot tell the international manager something that the spoken language does not. FALSENonverbal

Direct investment refers to overseas purchases of stocks and bonds to gain a return on the funds invested. FALSEPortfolio investment refers to overseas purchases of stocks and bonds to gain a return on the funds invested. FALSEPortfolio investment refers to overseas purchases of stocks and bonds to gain a return on

Although India is a member of the WTO and has benefited greatly from increased trade as a result of WTO agreements, China is not yet a member. FALSEBoth China and India are WTO members and have benefited greatly from increased trade facilitated by the WTO. FALSEBoth China and India are WTO

The same general criteria for selecting home-country employees apply to host-country nationals. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. Multiplicity and interdependence are among the four dimensions of complexity identified by scholars. TRUEThe other two are ambiguity and dynamism. TRUEThe other

Strategic planning processes are something that only the company's most senior executives are involved with. FALSETop management, at the urging of strategy consultants, is assigning strategic planning to teams of line and staff managers from different business, geographic, and functional areas. FALSETop management, at the urging of strategy consultants, is assigning

Incoterms are established by the UN Commission on International Trade. FALSEIncoterms are established by the International Chamber of Commerce. FALSEIncoterms are established by the International Chamber of Commerce. FALSE Incoterms are established by the International Chamber of Commerce. International strategy involves decisions that deal with a single area, such as marketing or

Out of all the pricing methods mentioned, the preferred one for sellers is Ex-Works/factory door. TRUEAs stated directly in the text. TRUEAs stated directly in the text. TRUE As stated directly in the text. Japanese cultural values suggest that in Japan, antitrust law against cartels would be strictly enforced. FALSEThe zaibatsu, Japanese conglomerate,