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For the conservative international firm, there is no reason to move money other than the repatriation of profits. If a firm decides to set up its own export operation rather than do indirect exporting, the firm must obtain overseas distribution. […]

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 […]

The three main team leadership activities in any environment are establishing the team, coaching team members, and setting team norms. Supply chains are an integral part of global quality and cost management initiatives, since a typical company’s supply chain costs […]

The International Finance Corporation (IFC) acts as an investment banker, arranging private risk ventures in developing countries. The GLED model is used to develop management skills. FALSE GLED is a global leadership expertise development model. Managers may consider entering a […]

Some of the culture dimensions that are involved in change are tolerance of ambiguity and power distance. Incoterms are 11 trade terms that describe the responsibilities of the buyer and seller in international trade. TRUE As stated directly in the […]

Countries in which strong competition already exists are eliminated from consideration by most managers. The more familiar, or the more similar, conditions in the host country are perceived to be, the more likely headquarters is to rely on subsidiary management. […]

There is a growing tendency for firms to use strategic planners to devise the corporate plan, which is then handed to operations people for execution. An example of an informal, cognitive institution would be the celebration of Halloween. TRUE The […]

In the year 2008, twice as much FDI invested in the United States was spent in acquiring established businesses than in setting up new ones. Globalization increases the complexity of the external but not the internal context of the company. […]

The WTO supports trade with discrimination as a basic right of trading nations. Trade flows are good indicators of the magnitude of present sales. TRUE As stated directly in the text. The level of merchandise exports coming from Africa decreased […]

Although engineers are required for the maintenance of specialized machinery, only highly-skilled people are needed to attend the machines. Gift-giving across cultures is a simple kindness and need not be complicated with attempts to understand. The act of generosity says […]

Currency exchange rate movements are well understood by economists and can be accurately forecast, which eliminates risk for the international seller operating with exposure outside the home currency. The matrix overlay organizational form attempts to eliminate some of the problems […]

When a company’s primary strategic orientation is multidomestic, an ethnocentric orientation is particularly appropriate. Advertisers have followed glocalization to reduce costs, enabling them to develop a common strategy for large regions. TRUE As stated directly in the text. CeBIT is […]

As their overseas operations have increased in importance, companies have felt the need to: A. eliminate the international division. B. establish worldwide organizations based on product, function, region, or customer classes at the top level. C. lower production costs by […]

In FAS (free alongside ship, loading port) the buyer pays all the transportation and delivery expenses up to the ship’s side and clears the goods for export. Risk passes at the ship’s rail. The U.S. enforcement of Equal Employment Opportunity […]

A fronting loan is used when the firm does not have the collateral or reputation to borrow in a foreign environment. Low-context cultures such as the United States have explicit communication patterns. TRUE Low-context cultures are explicit in their communication. […]

The United States avoids extraterritorial application of its laws. The law of one price states that in an efficient market, like products will never have like prices. FALSE The law of one price suggests that in efficient markets, like products […]

Historically, foreign direct investment has followed foreign trade, and one reason is that foreign trade is typically less costly and less risky than making a direct investment into foreign markets. Failure rates for expatriate assignments have been reported to range […]

Pricing that is established for transactions between members of the enterprise is called transfer pricing. When managers are assigned and move abroad with their families, the most difficult adjustments are frequently for the children. TRUE As stated directly in the […]

Accounting is an objective, fact-based discipline and is not influenced by culture. Swap contracts exchange foreign currency debt for another liability in the home currency. FALSE Swaps are agreements to exchange currencies at specified rates and times, and they can […]

Historically, approximately two-thirds of the value of corporate investments made in the United States from abroad has been spent to acquire going companies rather than to establish new ones. Currencies float because they are allowed to make their own adjustments […]

Firms may choose to issue stock in foreign markets in order to tap into a broader investor pool. The United States has only about 10 percent of the world’s population, so the vast proportion of most companies’ potential customers are […]

The product global corporate form eliminates the duplication of product and area specialists. The local manufacturing organization is usually integrated vertically to a greater extent than the parent company is. FALSE The local manufacturing organization is rarely integrated vertically to […]

The EU does not apply its competition policy beyond the EU. Michael Porter claims that demand conditions, factor conditions, related and supporting industries, and firm strategy, structure, and rivalry, rather than government and chance, are factors that affect national competitiveness. […]

The traditional functions of purchasing, such as supplier determination, analysis, and selection, have to be accomplished before the actual purchasing via e-procurement. The effectiveness of supply chain management efforts is strongly influenced by how a company manages the interface of […]

Leadership traits may vary some by culture, but underneath they build on the idea that all people want to be led and directed. A confirmed letter of credit guarantees payment to the seller. TRUE As stated directly in the text. […]

Critics of large global firms compare these firms’ sales with nations’ total sales to illustrate the tremendous size of these firms. U.S. ocean shipping companies are benefiting from U.S. government subsidies. TRUE This is the case, and it is an […]

According to the text, which of the following is true? A. Zara’s competitive advantage comes from its stylish fashion design. B. Zara’s supply chain management processes are combined with a strategy of limited availability of its merchandise. C. Two of […]