40) The world’s largest manufacturer of peppermint candy canes was located in Albany, Georgia,
until it could no longer afford to buy the sugar needed for its operation. It moved its
manufacturing business to Mexico where there are no restrictions (like those that exist in the
United States) on the amount of sugar that can be brought into the nation. The business moved to
Mexico because of a(n) ________ established by the U.S. government.
A) tariff
B) trade imbalance
C) excise tax
D) subsidy
E) quota
41) Russia currently has a limit on pork of 400,000 metric tons annually that can be imported
from any country. This restriction would be considered a
A) tariff.
B) trade imbalance.
C) limit tax.
D) quota.
E) subsidy.
42) An institution that sets rules governing trade between its members through a panel of trade
experts who decide on trade disputes between members and issue binding decisions is referred to
as the
A) League of Nations (LoN).
B) World Trade Organization (WTO).
C) Association for Commerce Equity (ACE).
D) United Nations Board of Trade (UNBT).
E) Global Better Business Bureau (BBB-G).
43) The World Trade Organization (WTO) refers to
A) the world’s largest banking institution responsible for establishing and maintaining equitable
exchange rates for all member nations.
B) the world’s largest licensing institution responsible for the certification of products distributed
to a global market.
C) an institution that sets rules governing trade between its members through panels of trade
experts who decide on trade disputes between members and issue binding decisions.
D) a multinational trade organization composed of the world’s wealthiest nations whose primary
purpose is to aid in the economic growth of developing nations.
E) a multinational trade organization comprised of the world’s wealthiest nations whose primary
purpose is to promote free trade economies.
44) There are ________ World Trade Organization countries, including the United States, which
account for more than 90 percent of world trade.
A) 31
B) 52
C) 97
D) 133
E) 162
45) Which of the following statements about the World Trade Organization (WTO) is most
accurate?
A) The WTO acts as an agent in trade negotiations between its members and the remainder of
the world.
B) The 119 member countries of the WTO account for less than 25 percent of world trade.
C) The WTO attempts to mitigate trade wars between countries.
D) The WTO uses legal scholars who can only issue nonbinding recommendations.
E) The WTO was formed by the United Nations.
46) Which of the following statements about the World Trade Organization (WTO) is most
accurate?
A) The World Trade Organization is a temporary institution.
B) The 168 member countries of the WTO account for less than 25 percent of world trade.
C) The WTO sets rules governing trade between its members and the rest of the world.
D) The WTO uses panels of trade experts who can issue nonbinding recommendations.
E) The WTO was formed by the major industrialized nations of the world.
47) A trade war is initiated when
A) the World Trade Organization issues fines to two or more corporations in a country.
B) two or more companies attempt to undercut one another’s pricing strategy.
C) a country begins to accept imports for a new product category or class.
D) a country reduces tariffs for a particular product category or class.
E) countries attempt to damage each other’s trade with excessive tariffs and quotas.
48) The European Union (EU) consists of 28 countries with about 750 million consumers. The
EU has eliminated most barriers to the free flow of products, capital, and labor across its borders.
Which of the following countries is not a member of the EU?
A) Poland
B) Greece
C) Ireland
D) Switzerland
E) France
49) The European Union is an economic and political union of ________ member countries that
have eliminated most barriers to the free flow of products, services, capital, and labor across their
borders.
A) 17
B) 20
C) 28
D) 30
E) 37
50) To eliminate the need to continually monitor currency exchange rates, 16 of the countries in
the European Union (EU) have adopted a common currency, which is called the
A) pound.
B) franc.
C) euro.
D) mark.
E) dollar.
51) To eliminate the need to continually monitor currency exchange rates, ________ of the
countries in the European Union (EU) have adopted a common currency called the euro.
A) 11
B) 16
C) 20
D) 28
E) 32
52) The European Union (EU) has been beneficial to electronic commerce because it is no longer
necessary to
A) use multiple languages when settling accounts for purchases made across borders.
B) continually monitor currency exchange rates among participating nations.
C) trade with the former Eastern European communist countries.
D) obey international e-trade regulations.
E) use the American dollar as the economic standard.
53) The EU has benefited firms in its member nations because
A) it provides a safe haven in times of world economic crises.
B) there is a common language advantage among EU consumers.
C) most companies within the EU are engaging in strategic global partnerships.
D) there is now a legally binding code of economic conduct.
E) firms do not need to market their products and services on a nation-by-nation basis.
54) The EU has benefited its member nations in part because
A) there is a legally binding code of economic conduct.
B) there is immunity against world recessions.
C) there are fewer regulatory restrictions on transportation, advertising, and promotion.
D) there is a common language advantage among EU consumers.
E) most companies within the EU are engaging in strategic global partnerships.
55) The North American Free Trade Agreement was designed to encourage free trade between
A) North America, Central America, and South America.
B) the United States and the European Union.
C) member countries originally from NATO (North Atlantic Treaty Organization).
D) the United States, Canada, and Mexico.
E) the United States, Canada, and the United Kingdom.
56) CAFTA-DR is a comprehensive free trade agreement between Costa Rica, the Dominican
Republic, El Salvador, Guatemala, Honduras, Nicaragua, and
A) the United States.
B) Panama.
C) Belize.
D) Cuba.
E) Mexico.
57) When firms originate, produce, and market their products and services worldwide, it is
referred to as
A) acculturation.
B) free trade.
C) global branding.
D) global competition.
E) transactional exchange.
58) Global competition exists when
A) a firm produces and markets its products domestically rather than globally.
B) firms originate, produce, and market their products and services worldwide.
C) two firms from two different countries compete for market share in a single domestic market.
D) two or more firms from different nations combine their resources to market products in a
single domestic market.
E) the firm from one nation dominates the market for its product in every nation.
59) Coca-Cola has operations in all but three nations in the world and Pepsi-Cola is now
available in more than 160 countries and territories, making the soft drink industry an example of
A) global competition.
B) acculturation.
C) free trade.
D) global branding.
E) transactional exchange.
60) In terms of the global marketplace, there are three primary types of companies: ________
firms, multinational firms, and transnational firms.
A) worldwide
B) conglomerate
C) intercontinental
D) international
E) cosmopolitan
61) In terms of the global marketplace, there are three primary types of companies: international
firms, ________ firms, and transnational firms.
A) large-scale
B) conglomerate
C) intercontinental
D) cosmopolitan
E) multinational
62) The administrative, marketing, and manufacturing operations that many international firms,
multinational firms, and transnational firms have around the world are often called
A) divisions.
B) outlets.
C) departments.
D) markets.
E) holding companies.
63) In terms of the global marketplace, there are three primary types of companies: international
firms, multinational firms, and transnational firms. The key factor that distinguishes one from
another is
A) the firm’s financial capacity to take risks.
B) the willingness and ability to embrace diversity and cultural differences.
C) the firm’s orientation toward and strategy for global markets and marketing.
D) the relative position of the product or service in terms of its life cycle.
E) the relative size of the firm both in financial terms and in production capacity.
64) A(n) ________ firm engages in trade and marketing in different countries as an extension of
the marketing strategy in its home country.
A) multidomestic
B) meganational
C) international
D) multinational
E) transnational
65) Generally speaking, a(n) ________ firm markets its existing products and services in other
countries the same way it does in its home country.
A) meganational
B) international
C) multinational
D) transnational
E) intranational
66) Mars, America’s second-largest candy company, began doing business in Russia in the late
1980s. The Snickers bar is one of the top-selling candies in Russia and is marketed in much the
same way as it is in the United States. What type of global company is Mars?
A) international firm
B) multidomestic firm
C) transnational firm
D) meganational firm
E) multinational firm
67) A firm that views the world as consisting of unique parts and markets to each part differently
is referred to as a(n)
A) meganational firm.
B) extranational firm.
C) international firm.
D) multinational firm.
E) transnational firm.
68) A multidomestic marketing strategy refers to
A) the strategy of transnational firms that employ the practice of standardizing marketing
activities when there are cultural similarities and adapting them when cultures differ.
B) the strategy used by firms that use the same product variations, brand names, and advertising
programs for every country in which they do business.
C) the strategy used by firms that have as many different product variations, brand names, and
advertising programs as countries in which they do business.
D) the strategy of seeking out already established firms in other nations and selling them the
rights to manufacture and distribute the firm’s products.
E) the strategy currently used by most U.S. domestic firms that when entering a new
international market, these firms offer only those products that require the least amount of
product adaptation.
69) Companies that use a(n) ________ marketing strategy have as many different product
variations, brand names, and advertising programs as countries in which they do business.
A) ethnocentric
B) multidomestic
C) transnational
D) global
E) international
70) Lever Europe, a division of Unilever, markets Snuggle fabric softener. But in 10 European
countries, it uses seven brand names, including Kuschelweich in German, Coccolino in Italy, and
Mimosin in France. These products also have different packages, different advertising programs,
and occasionally different formulas. From this information, we can assume that Lever Europe
uses a(n) ________ marketing strategy.
A) ethnocentric
B) transnational
C) global
D) international
E) multidomestic
71) U.S. appliance manufacturers note that people in Northern Europe shop only once a week, so
they need bigger refrigerators than Southern Europeans, who shop daily. Furthermore, Northern
Europeans insist that freezers should be on the top just as firmly as Southern Europeans want
them on the bottom. Based on this, U.S. appliance manufacturers would more likely be
successful if they used a(n) ________ marketing strategy.
A) global
B) multidomestic
C) transnational
D) meganational
E) international
72) Disney employed a(n) ________ marketing strategy for its Disneyland Paris, particularly
when it came to the eateries in the park. These restaurants featured recipes that were revised for
local tastes, alcoholic beverages (not permitted in previous parks), and increased outdoor seating.
A) global
B) transnational
C) multidomestic
D) meganational
E) international
73) A(n) ________ firm views the world as one market and emphasizes cultural similarities
across countries or universal consumer needs and wants more than differences.
A) transcontinental
B) multidomestic
C) international
D) multinational
E) transnational
74) The strategy transnational firms employ that standardizes marketing activities when there are
cultural similarities and adapts them when cultures differ is referred to as a(n)
A) global marketing strategy.
B) integrated marketing strategy.
C) transnational marketing strategy.
D) meganational marketing strategy.
E) international marketing strategy.
75) A global marketing strategy refers to
A) the strategy used by multinational firms that have as many different product variations, brand
names, and advertising programs as countries in which they do business.
B) the strategy of transnational firms not to employ adaptive marketing techniques when there
are cultural differences, but to redirect their marketing resources toward customer education.
C) the strategy of transnational firms that employ the practice of standardizing marketing
activities when there are cultural similarities and adapting them when cultures differ.
D) the global strategy of seeking out already established firms in other nations and selling them
the rights to manufacture and distribute the firm’s products through a host nation’s local
businesses.
E) the strategy currently used by most U.S. domestic firms that when entering a new
international market, these firms offer only those products that require the least amount of
product adaptation.
76) Which of the following types of firms would be most likely to use a global marketing
strategy?
A) multidomestic
B) multinational
C) multicountry
D) transnational
E) transborder
77) A brand marketed under the same name in multiple countries with similar and centrally
coordinated marketing programs is referred to as a(n)
A) transnational brand.
B) international brand.
C) multinational brand.
D) global brand.
E) meganational brand.
78) A global brand refers to
A) two or more domestic products that coincidentally share the same brand name but represent
two completely unrelated products.
B) two or more international products that coincidentally share the same brand name but
represent two completely unrelated products.
C) a brand marketed under the same name in multiple countries with similar and centrally
coordinated marketing programs.
D) a brand that is essentially the same but that has minor adaptations made to meet the more
specific needs of different nations.
E) a brand marketed under different names in multiple countries with similar and centrally
coordinated marketing programs.
79) Which of the following statements regarding global brands is most accurate?
A) A global brand has centrally coordinated marketing programs.
B) A global brand is marketed under different names but uses identical ads for all markets.
C) A global brand alters the product formulation or service for each geographical region.
D) A global brand delivers varying benefits based on the GDP of each country.
E) A global brand is a collaborative effort among several different transnational firms.