Which of the following statements is true of Web-based EDI systems?
A. Cloud-based EDI systems are more expensive than proprietary solutions.
B. Small firms will not be able to make use of cloud-based EDI systems.
C. Cloud-based systems are much easier to install compared to proprietary solutions.
D. Most cloud-based systems are implemented to support proprietary solutions.
In the 1960s, the Swedish vacuum manufacturer Electrolux successfully marketed
vacuums in the United Kingdom with the slogan “Nothing sucks like an Electrolux”.
The informal United States meaning of the word ‘sucks’ was already well known in the
United Kingdom at the time, and the company hoped the slogan, with its possible
double entendre, would gain attention. When this slogan was used in the American
market, it was a catastrophe. This is an example of _____.
A. cultural differences
B. religious differences
C. source effects
D. noise levels
Discuss how companies such as Exxon, Kodak, and IBM helped improve human rights
in South Africa.
Wal-Mart makes bulk purchases from its vendors and hence it is able to get better deals
than its competitors. This allows Wal-Mart to offer greater discounts to its customers. In
this case, Wal-Mart benefits from _____.
A. first-mover advantage
B. constant marginal returns
C. economies of scale
D. absolute advantage of production
Which of the following countries has been the largest recipient of foreign direct
investment and received about $60 billion to $100 billion a year in inflows in
2004-2012?
A. Brazil
B. Russia
C. India
D. China
External stakeholders:
A. are individuals or groups who own the business.
B. include all employees, the board of directors, and stockholders.
C. typically comprise customers, suppliers, lenders, etc.
D. are individuals or groups who work for the business.
Ethical systems are:
A. a set of moral principles, or values, that are used to guide and shape behavior.
B. shared beliefs and rituals that are concerned with the realm of the sacred.
C. routine conventions of everyday life.
D. social rules that govern people’s actions toward each other.
_____ is the direct exchange of goods and/or services between two parties without a
cash transaction and is the simplest arrangement.
A. Counterpurchase
B. Barter
C. Offset
D. Switch trading
_____ are the advantages gained by early entrants into a market.
A. Early investor advantages
B. First-mover advantages
C. First-to-market advantages
D. Late-mover advantages
Which of the following is a drawback of the Eurocurrency market?
A. Increased governmental controls
B. High reserve ratio requirements
C. Low interest rates on deposits
D. Exposure to foreign exchange risk
_____ draws on economic theory to construct sophisticated econometric models for
predicting exchange rate movements.
A. Lead strategy
B. Fundamental analysis
C. Lag strategy
D. Technical analysis
_____ pricing is the use of price as a competitive weapon to drive weaker competitors
out of a national market.
A. Multipoint
B. Value-based
C. Experience curve
D. Predatory
Costs that an early entrant has to bear that a later entrant can avoid are known as _____.
A. first-mover costs
B. late-mover disadvantages
C. pioneering costs
D. licensing fees
In Sen’s view, development is an economic process that should be assessed by material
output measures such as GNI per capita.
When a channel is exclusive:
A. the firm sells and distributes only high-end products.
B. it is controlled by market leaders or by firms who have a niche market.
C. the firm’s products are focused only on the elite, upper class customers.
D. it is often difficult for a new firm to get access to shelf space in supermarkets.
How is the adverse effect of the balance of payments for the home country due to an
FDI usually offset?
A. By increased imports to the home country as a result of the FDI
B. By the subsequent inflow of foreign earnings
C. By substituting direct exports made earlier from the home country
D. By further investments usually made to expand foreign operations For the home
country, the balance of payments suffers from the initial capital outflow required to
finance the FDI. This effect, however, is usually more than offset by the subsequent
inflow of foreign earnings.
This is where cutting-edge production should take place, or at least be tested for
implementation in other parts of the firm’s production network.
A. Source factory
B. Lead factory
C. Contributor factory
D. Outpost factory
The probability of effective communications is reduced by:
A. noise.
B. location effects.
C. country of origin effects.
D. source effects.
A _____ serves as a receipt, a contract, and a document of title.
A. letter of credit
B. bill of lading
C. draft
D. bill of exchange
Cultural myopia refers to a firm’s failure to:
A. adapt to certain ethnocentric cultures.
B. act confidently in host-countries.
C. understand host-country cultural differences.
D. prevent gender discrimination within the firm.
A hardship allowance is paid:
A. when the expatriate is being sent to a location where such basic amenities are grossly
deficient by the standards of the expatriate’s home country.
B. to ensure that an expatriate’s children receive adequate schooling (by home-country
standards).
C. to ensure that the expatriate will enjoy the same standard of living in the foreign
posting as at home.
D. to ensure that the expatriate can afford the same quality of housing in the foreign
country as at home.
The distinguishing feature of many firms that pursue a(n) _____ strategy is that they are
selling a product that serves universal needs, but they do not face significant
competitors.
A. international
B. localization
C. transnational
D. global standardization
The _____ and Knickerbocker’s theory of FDI tend to be less useful from a business
perspective because they are descriptive rather than analytical.
A. noninterventionist theory
B. internalization theory
C. eclectic paradigm
D. product life-cycle theory The product life-cycle theory and Knickerbocker’s theory
of FDI tend to be less useful from a business perspective because they are descriptive
rather than analytical.
Krugman has suggested that trade policy designed to retaliate against another country’s
trade policy would:
A. benefit the multination firms of both countries.
B. benefit the citizens of both countries.
C. hurt the multinational firms of both countries.
D. hurt the citizens of both countries.
In a country where competition is limited:
A. prices will be low.
B. there will be low elasticity of demand.
C. prices will be high.
D. consumers’ bargaining power rises.
_____ deposits are regulated in most industrialized countries.
A. U.S. currency
B. Domestic currency
C. Foreign currency
D. Eurocurrency
Making all or part of a product in-house is most beneficial when a firm wants to:
A. build valuable capabilities over time.
B. labor costs are more at the firm’s location.
C. increase strategic flexibility.
D. start business in more geographical locations.
_____ approaches to business ethics are raised by business ethics scholars primarily to
demonstrate that they offer inappropriate ethical decision making in a multinational
enterprise.
A. Cultural relativism
B. The righteous moralist
C. Straw men
D. The naive immoralist
It is in the best interest of prospective employees to find out all they can about the:
A. external stakeholders of an organization.
B. ethical climate in an organization.
C. internal stakeholders of an organization.
D. corporate social responsibility actions of an organization.
Which of the following is a problem that limits a firm’s ability to pursue a geocentric
policy?
A. The firm fails to understand host-country cultural differences that require different
approaches to marketing and management.
B. The lack of management transfers from home to host countries, and vice versa, can
lead to a lack of integration between corporate headquarters and foreign subsidiaries.
C. It limits advancement opportunities for host-country nationals.
D. The higher pay that managers on an international fast track enjoy may be a source of
resentment within a firm.
One of the strategies pursued by international businesses is _____, where value is
created by realizing experience curve and location economies.
A. global standardization
B. localization
C. international
D. transnational
By centralizing decision making, a firm:
A. allows managers to respond to environmental changes more quickly.
B. runs the risk of not being able to respond to environmental changes quickly.
C. can avoid the duplication of activities that occurs when similar activities are carried
on by various subunits within the organization.
D. often has issues with duplication of activities that occurs when similar activities are
carried on by various subunits within the organization.
An ethnocentric staffing policy is one in which:
A. all key management positions are filled by host-country nationals.
B. host-country nationals are recruited to manage subsidiaries.
C. all key management positions are filled by parent-country nationals.
D. the best people are recruited for key jobs throughout the organization, regardless of
nationality.
_____ occurs when higher-cost external producers are replaced by lower-cost external
producers within the free trade area.
A. Trade creation
B. A customs union
C. Trade diversion
D. A common market
