1) An effective code of conduct reports results to external stakeholders.
2) Vertical integration occurs when the company owns the entire supplier network or at
least a significant part of it.
3) Countries typically establish export restrictions to encourage the development of
substitute products.
4) The identity of a nation is typically promoted through symbols, monuments, and
museums.
5) Markets are not always perfectly competitive and some firms consistently
outperform industry averages. This suggests that firm performance is also influenced by
the presence of bright, motivated managers and their keen sense of innovative products
or processes.
6) An economic system is the set of structures and processes that guides the allocation
of resources and shapes the conduct of business activities within a country.
7) A major challenge faced by Western Union in transferring money between the United
States and Mexico is that Mexican citizens trust the banks but do not trust Western
Union due to its reliance on global banks.
8) Digitization has altered location economics and established a new global model for
service providers in the financial and legal industries.
9) The four favorable domestic conditions of the diamond of national advantage help to
explain how and where globally competitive companies develop and sustain
themselves.
10) Support activities define the infrastructure of the firm and serve as the basis for the
daily implementation of primary activities in the value chain.
11) An executive with a polycentric staffing policy presumes that successful business
practices at home need not change when transferred to foreign markets.
12) A push strategy is most likely preferable to a pull strategy when goods are sold
using self-service distribution.
13) Subpart F income is passive and usually derived from operations in a tax-haven
country.
14) The formation of CARICOM has primarily been triggered by the desire of Jamaica,
Trinidad, and Tobago to expand the region’s market size and attract more FDI.
15) Coordination methods include mutual adjustment, planning, and standardization.
16) Expatriate failure, defined in broad terms, refers to the ________.
A) manager’s premature return home due to poor job performance
B) manager’s miscues, which give competitors a market advantage
C) unintentional dilution of the company’s core competency
D) poor expatriate selection procedures of the MNE
17) Compared with a forward contract, a futures contract ________.
A) is more flexible
B) is normally available through commercial banks
C) does not guarantee a future exchange rate
D) is only traded on an exchange
18) All of the following are international business translation problems EXCEPT which
of the following?
A) All written work requires back translation in order to be understood in a second
language
B) Because languages and the common meaning of words are constantly evolving, the
intended meaning of a word may be different from what the listener or reader
understands
C) Some words in one language simply don’t have a direct translation into another
language
D) Words mean different things in different contexts, thus the wrong context may be
translated
19) The origin of investment proposals differs from the origin of divestment proposals
in that the divestment proposals are more likely to come from ________.
A) subsidiary management
B) outside the organization
C) higher up in the organization
D) line personnel as opposed to staff personnel
20) The Industry Organization (IO) paradigm assumes which of the following?
A) stable political and cultural trends
B) shifting foreign-exchange rates
C) perfect competition
D) unequal value
21) All the following are reasons for the lower international mobility of people than
capital EXCEPT which one?
A) The differences in economic return between countries are lower for people than for
capital
B) It is more expensive to move people than capital
C) People may have to learn another language and adapt to a different culture
D) International capital transfers have less cumbersome legal restrictions than
international movements of people
22) According to research, which of the following countries is the strongest supporter of
free markets?
A) China
B) India
C) France
D) Ukraine
23) A major force leading to the convergence of accounting standards is ________.
A) a shareholder orientation towards FDI
B) the global separation of capital markets
C) MNEs’ needs for foreign capital
D) pressures from the EU
24) Although the US film industry depends heavily on revenue in foreign countries,
revenue from international markets is usually low for a sports-themed film This is most
likely due to ________ factors
A) political
B) geographic
C) behavioral
D) legal
25) The translation method used when the functional currency is the parent currency is
the ________.
A) current-rate method
B) temporal method
C) translate-restate method
D) consolidation method
26) Which of the following elements is often overlooked when firms estimate the costs
of outsourcing to low-wage countries?
A) language barriers
B) overabundance of skilled and educated workers
C) lack of inventory
D) shipping distances
27) A hyperarchy is ________.
A) a form of structure with precise superior and subordinate relationships
B) a form of structure that relies on extensive centralization
C) a large-scale, self-organizing community
D) analogous to a hierarchy
28) In advertisements aimed at different countries, companies sometimes use actors
who do not speak, along with a voice and/or print overlay. What is the main reason for
doing this?
A) avoiding dubbing that does not correspond to lip movements
B) altering themes and messages among countries
C) meeting legal requirements on morality
D) reaching a hearing- or sight-impaired audience
29) Governments use a multiple exchange rate system to ________.
A) increase their budget surplus
B) reduce exports
C) control foreign-exchange convertibility
D) limit deposit requirements
30) In the context of value chain analysis, the support activities of a firm include
________.
A) outbound logistics, human resources, and information systems
B) production, marketing, and operations
C) shipping and customer service
D) research and development
31) Under the current-rate method of translation, any gain or loss is known as a(n)
________.
A) liability
B) foreign-exchange
C) annual net income
D) accumulated translation adjustment
32) In conducting ________, a business sells goods directly to or through an
independent domestic intermediary in the exporter’s home country that exports the
products to foreign markets.
A) direct exporting
B) global marketing
C) strategic planning
D) indirect exporting
33) What motivations do companies have to act responsibly? How can codes of conduct
help firms to act ethically?
34) What are foreign trade zones? How are they used?
35) What is scanning? What opportunities and risks are most relevant to scanning?
36) Identify the three common components of modern legal systems and explain their
relevance to managers.
37) What is a Special Drawing Right (SDR)? How is it used?
38) What are the advantages and disadvantages of global and domestic sourcing? What
role does quality play in deciding between global and domestic sourcing?