BUS 41879 | Course Paper

Unlock access to all the studying documents.

View Full Document

Governments have facilitated economic integration by lowering barriers to international

trade and investment, harmonizing their monetary and fiscal policies within regional

economic integration blocs.

Many emerging market economies are dominated by family-owned rather than publicly

owned businesses.

Value chain is the collection of logistics specialists and activities that provides inputs to

manufacturers or retailers.

According to Dunning’s eclectic paradigm, proprietary technology, managerial skills,

trademarks or brand names, and economies of scale are examples of ownership-specific

advantages.

Decisions about local products that will be sold in only one country are typically the

joint responsibility of corporate and country-level managers, with the latter taking the

lead role.

Through labor relations, management and workers identify and determine job

relationships that will apply in the workplace.

Direct quote is the number of units of foreign currency obtained for one unit of

domestic currency.

The root cause of gray market activity is a large enough difference in price of the same

product between two countries.

A benefit of the monopolistic advantage theory is that firms can operate foreign

subsidiaries more profitably than the local firms that compete in their own markets.

International logistics usually make use of a single transportation mode.

The more diverse the firm’s global supply chain, the lesser the cost of logistics.

Training programs designed for preparing employees for assignments abroad consist of

area studies, practical information, and cross-cultural awareness.

Franchising is an advanced form of licensing in which the franchisor allows the

franchisee the right to use an entire business system in exchange for compensation.

The five approaches to analyzing ethical problems rarely conflict with each other.

National industrial policies designed to build new capabilities and encourage the

emergence of new industries typically exclude superior educational systems.

Typically, firms tend to concentrate research and development activities abroad rather

than in their home countries.

Developing economies are countries that have achieved substantial industrialization,

modernization, and rapid economic growth since the 1980s.

Firm strategy, structure, and rivalry of Michael Porter’s diamond model refer to the

presence of clusters of suppliers, competitors, and complementary firms that excel in

particular industries.

Foreign direct investment is the least risky entry strategy.

Project-based, nonequity ventures are difficult to set up.

In international business, marketing is concerned with identifying, measuring, and

responding to market opportunities abroad

Environmental challenges of global sourcing include currency fluctuations, tariffs and

other trade barriers, and adverse macroeconomic events.

Incremental pricing refers to setting prices to cover only the firm’s variable costs, but

not its fixed costs.

In helping identify ethical problems, the firm’s code of conduct should be tailored to

match the norms of each individual region from which the firm operates.

The recent economic turndown is expected to pressure advanced-economy firms to seek

further ways to reduce costs.

Estimates of company sales potential provide managers with the information necessary

to select the most appropriate business partners.

The level of integration of free trade areas is greater than that of customs unions.

Industrialization implies that emerging markets are increasing their dependence on

low-cost labor.

If an individual buys from a supplier whose currency is depreciating against the

individual’s currency, the individual will have to pay a larger amount of his own

currency to complete the purchase.

Emerging markets are home to low-wage, high-quality labor for manufacturing and

assembly operations.

The Bretton Woods Agreement was brought into existence in the late 1960s when the

U.S. needed to finance government programs and the Vietnam War.

Monopolistic advantage theory is a framework for determining the extent and pattern of

foreign-based value-chain operations.

Major supply shocks do not affect exchange rates.

While estimating company sales potential, managers may make multiple estimates

based on best-case, worst-case, and most-likely case scenarios.

The five approaches to analyzing ethical dilemmas often lead to similar solutions.

The purpose of capital budgeting is to defer payment for goods and services received

from the parent firm.

An efficient method of gathering information about a target market is to introduce a

product at an industry trade fair.

Which of the following is considered a regional hub?

A) Hong Kong

B) Ireland

C) Canada

D) Russia

Which of the following approaches to ethical standards for corporate governance

reflects the view that the best ethical action is the one that provides the most good or the

least harm?

A) common good approach

B) utilitarian approach

C) virtue approach

D) fairness approach

Which of the following is a characteristic of momentum trading?

A) Investors buy stocks as prices fall.

B) Investors sell stocks when others sell.

C) Investors buy stocks as prices rise.

D) Investors buy and sell stocks spontaneously.

Which of the following countries have the LEAST corruption?

A) Mexico

B) Philippines

C) Russia

D) Denmark

Quik Meal Structure (Scenario)

Quik Meal is a fast-growing MNE that manufactures and sells energy gels for

consumption by serious athletes, such as marathoners and triathletes. The energy gels

produced by Quik Meal taste much better than the gels sold by other firms, which has

led to an increase in sales. Managers and executives with Quik Meal need to determine

the best organizational structure for the young firm. Quik Meal has subsidiaries in Japan

and Brazil, while company headquarters are based in San Francisco.

Which of the following strengthens the decision by Quik Meal executives to centralize

operations?

A) Quik Meal offers five different flavors of energy gels for athletes.

B) Quik Meal executives report a steady rate of sales in the U.S. market.

C) Quik Meal country managers report few requests to alter product ingredients.

D) Quik Meal products use the same trademark and packaging in every country.

Organic Towel Exports (Scenario)

The Organic Towel Company (OTC) employs 400 workers at its facility in Liverpool,

England, where the firm has been manufacturing 100% organic cotton towels for five

years. OTC sells towels in the United Kingdom primarily to boutique hotels and

specialty retail stores, as well as to individual consumers through the company’s.

Recently, OTC managers attended a trade show in London where they made contact

with numerous foreign market managers. OTC received a request from Earth Waves, an

organic clothing store in Toronto, Canada, for a large order of towels. OTC had not

been looking into expanding, but firm managers are seriously considering the

opportunity to reach a global niche market with their towels.

Which of the following should be considered first in making the decision to export

OTC towels to Canada?

A) What is the probability of OTC and Earth Waves entering into a joint venture?

B) How much fluctuation occurs in the exchange rate between the Canadian dollar and

the British pound?

C) What is the likelihood of Earth Waves opening a subsidiary in Canada?

D) What documentation would be required for OTC to export towels to Asia?

Which of the following should an international manager keep in mind about the

constantly fluctuating exchange rates?

A) The prices the firm charges should be quoted in the firm’s currency exclusively.

B) The firm and its customers should use the exchange rate as it stands on the date of

each transaction, there is no scope for an agreement between them to use any other

specific exchange rate.

C) If goods are bought from a supplier whose currency is appreciating against the

buyer’s currency, the buyer will have to pay a lesser amount of their currency to

complete the purchase.

D) The time taken between placement and delivery of an order can at times go up to a

few months, fluctuations in the exchange rate during that time can cost or earn the firm

money.

Which of the following is an example of a new global challenger?

A) a firm from Russia that is rapidly growing in the communications industry

B) a U.S. non-profit that focuses on fundraising for children’s health care

C) an MNE from France with large-scale operations across the globe

D) an SME from Canada that began international operations early in its development

________ refers to an industrial relations practice in which labor representatives sit on

the corporate board and participate in company decision making.

A) Codetermination

B) Standardization

C) Repatriation

D) Collective bargaining

Representative C is most likely from ________.

A) Canada

B) Sudan

C) North Korea

D) Zimbabwe

When outsourcing, managers can minimize the risk of creating employee tension by

________.

A) increasing the number of junior managers for foreign assignments

B) increasing the annual training budget

C) sending domestic managers to foreign countries for training

D) reaching a consensus of managers and labor

Fun Play Global Sourcing (Scenario)

Fun Play Inc., a company manufacturing toys for children, has decided to outsource

some of its value-chain activities. However, the firm has no experience with global

sourcing and has hired a consulting firm to assist its managers. The consulting firm has

been assigned the task of determining which activities should be outsourced and where

the outsourced activities should be located.

Which of the following would most likely be considered by the consultants while

deciding whether to keep each value-adding activity in the home country or locate it in

a foreign country?

A) Who will be responsible for training suppliers in foreign locations?

B) Can different value-adding activities be effectively configured across the world?

C) Would the HR department of Fun Play be able to ensure smooth repatriation for

managers after they complete their assignments abroad?

D) What are the odds in favor of Fun Play’s dominating the children’s toy segment in its

home country?

Which of the following most likely complicates international performance appraisals?

A) overproduction

B) distance from the headquarters

C) lack of general consensus among managers with regard to reward systems

D) cost of doing business abroad

________ is a formal process for assessing how effectively employees perform their

jobs.

A) Performance planning

B) Performance management

C) Performance appraisal

D) Performance guarantee

Funding obtained from sources inside a firm is known as ________.

A) structural financing

B) grid loan financing

C) internal network financing

D) intracorporate financing

Organic Towel Exports (Scenario)