1) Dispersed value chains make sense when costs vary across countries.
2) When a company sells technologically advanced products to global customers, it is
more likely to handle distribution itself.
3) The fact that a company is the market leader in one country is no guarantee that it
will be the leader in another country
4) Pressures for global integration include economic integration, convergent consumer
preferences, and political demands imposed by host countries.
5) Supporters of globalization assert that the process helps countries strengthen their
sovereignty
6) An internal code of conduct is a set of guidelines, recommendations, and rules issued
by entities within society but outside the firm with the intent of affecting the behavior
of international business entities in order to enhance corporate responsibility.
7) The collapse of communism in the late 1980s and early 1990s led to a more
widespread adoption of the principles of capitalism.
8) International law takes precedence over national laws in determining permissible
practices in pricing, distribution, advertising, and promotion of products and services in
a particular country.
9) Barkely Enterprises, a U.S. manufacturer, received assistance from the Overseas
Private Investment Corporation when it expanded operations into Saudi Arabia. Which
of the following types of support did Barkely most likely receive from OPIC?
A) financial capital
B) cultural training
C) legal guidance
D) political risk insurance
10) All of the following have been predicted to occur in the future as the result of
advances in global communications EXCEPT which one?
A) In spite of being able to work anywhere, people will choose to live primarily where
their employers are headquartered
B) The brightest minds will work more at home but will still need face-to-face
interaction with their colleagues
C) People will be drawn to live in the same places that attract people as tourists
D) People who are both highly motivated and highly creative will continue to be
attracted to interact with people like themselves
11) What is a turnkey operation?
A) a contract for the complete construction of an operating facility for a fee
B) a contract with a government to service one of its key industries
C) the buying of another company
D) the repatriation of equity
12) Factor mobility refers to the movement of which of the following combinations?
A) capital, technology and people
B) currency, profits and raw materials
C) labor, capital and management
D) trade, profits and materials
13) Which of the following is most likely a true statement about companies’ acquisition
of resources/assets abroad?
A) Regardless of industry, cheap labor is the most sought after resource
B) Resource availability limits a firm’s production location choices
C) Regardless of industry, raw materials are the most sought after resource
D) Risks are higher for resource-seeking than for sales-seeking foreign operations
14) The purchasing power parity theory claims that a change in relative ________
between two countries must cause a change in ________ in order to keep the prices of
goods in two countries fairly similar.
A) exchange rates; inflation
B) inflation; exchange rates
C) interest rates; inflation
D) interest rates; exchange rates
15) Dixon Manufacturing, a British MNE, believes that its business practices are
superior, so it does not make any policy changes in foreign markets. Dixon
Manufacturing most likely takes a(n) ________ approach to staffing.
A) ethnocentric
B) polycentric
C) geocentric
D) monocentric
16) Iverson Products is a U.S. firm that is considering expanding internationally by
exporting. Which of the following is the LEAST likely benefit for Iverson?
A) boosting marketplace flexibility
B) improving economies of scale
C) facing lower business risk compared to other foreign market entry options
D) requiring fairly few resources
17) All of the following are primary duties of the Bureau of Customs and Border
Protection EXCEPT which one?
A) assessing all duties, taxes, and fees on imported merchandise
B) collecting import and export tariffs
C) protecting the U.S. from threatening imports
D) policing smuggling operations
18) A government increases its internal debt for all of the following reasons EXCEPT
________.
A) the tax system is so poorly run that the government cannot collect all the revenues it
expects
B) government costs such as security and social programs exceed total tax revenues
C) the government borrows money from international financial institutions
D) state-owned enterprises run large deficits
19) What is the difference between primary and secondary activities in the value chain?
Describe the functions of configuration and coordination in these value activities.
20) In a brief essay, discuss the concepts of transfer pricing and hedging.
21) Explain why the argument that “anything that is legal is ethical” is insufficient.
22) Describe how an MNE might use reports as a control mechanism.
23) What are the arguments for and against nations developing and implementing
strategic trade policies?