It is most accurate to say that within most nations’ borders, people largely share such
essential attributes as ________ and ________.
A) work attitudes; occupations
B) lifestyles; education level
C) education level; ethnicity
D) values; language
A U.S. firm is acquiring an existing company in Germany rather than starting up a new
foreign operation. Which of the following statements best supports this decision?
A) Because the German firm is performing poorly, there is a good turn-around
opportunity.
B) The U.S. firm’s U.S. facility is working at capacity.
C) Stock market prices have been very high in Germany.
D) The German firm has skilled personnel that the U.S. firm cannot hire at a good price
on its own.
Coca-Cola has subsidiaries all over the world. The process of combining the results of
its far-flung operations into one set of financial statements for investors is known as
________.
A) combination
B) translation
C) consolidation
D) unification of results
Which legislation triggered many foreign MNEs to exit the New York Stock Exchange?
A) Davis-Bacon Act
B) Sarbanes-Oxley Act
C) Norris-LaGuardia Act
D) McCarran-Ferguson Act
A worrisome outcome of chronic inflation is that it tends to ________.
A) erode confidence in a country’s currency
B) give central banking officials excessive flexibility to manage monetary policy
C) increase the real income of people, thereby inflating their spending and borrowing
levels
D) lower consumer demand for foreign goods, which triggers lower prices and
eventually lower employment
Which of the following is most likely a benefit for firms that participate in the global
capital market?
A) numerous investment opportunities
B) large pool of financing sources
C) equally balanced capital structure
D) quick sale of stocks and bonds
Companies most likely use the foreign-exchange market to ________.
A) diversify their expenses from other sources
B) convert money for use in financial transactions
C) increase their presence on the black market
D) acquire currency from emerging markets
Why is London most likely the top market for trading foreign exchange?
A) The British pound is the world’s top trading currency.
B) Most multinational firms are headquartered in London.
C) London is uniquely positioned geographically in terms of time zones.
D) British traders have always been the most sophisticated in the world.
If the real interest rate is 5%, the rate of inflation in the United States is 6%, and the rate
of inflation in the United Kingdom is 3%, which of the following statements would
NOT be true?
A) The nominal rate of interest in the United States would be greater than the nominal
interest rate in the United Kingdom.
B) The difference between the U.K. and U.S. interest rates is a function of the
difference between their inflation rates.
C) The nominal rate of interest in the United States and the United Kingdom would be
the same because of purchasing power parity.
D) Investors would get a higher return on their money in the United States.
The three types of interpretative frameworks in international businesses are ________.
A) ethnocentric, polycentric, and geocentric
B) ethnocentric, intercentric, and monocentric
C) monocentric, neocentric, and polycentric
D) intracentric, geocentric, and neocentric
Which of the following is a primary business objective for pursuing ethical behavior?
A) avoiding industrial sanctions
B) developing competitive advantages
C) developing creative advertisements
D) discouraging false commitments to the firm
________ consists of specific learned norms based on attitudes, values, and beliefs of a
group of people.
A) Ethnology
B) Civilization
C) Culture
D) Doctrine
Some key ________ factors in a company’s international business external environment
are its product strategy and access to resources.
A) geographic
B) political
C) competitive
D) behavioral
A problem of using the nation as a reference point for culture is that ________.
A) nations fail to mediate the different interests within their boundaries
B) self-stereotypes tend to fall along national lines
C) such an approach tends to be polycentric
D) variations tend to be great within a country (state)
Logistics is also known as ________.
A) internal logistics
B) materials management
C) the internal supply chain
D) value-added management
Which of the following is most likely to occur when a firm segments markets by
country?
A) achieving objectives by following a sales orientation strategy within that market
B) initially targeting the high-income consumers within that market
C) overlooking similarities between different countries
D) introducing multiple products to assess demand
In deciding whether to make or buy, MNEs should focus on those parts that are
________ to the product and that they are ________ at making.
A) critical; distinctively good
B) incremental; distinctively good
C) critical; marginally good
D) incremental; marginally good
Most of the world’s goods and services are sold ________.
A) in international markets
B) in the countries where they are produced
C) through exports to small countries
D) through exports to large countries
In which quadrant of a disclosure/assessment matrix for accounting systems would you
most likely find less-developed Latin countries?
A) conservatism and secrecy
B) transparency and conservatism
C) secrecy and transparency
D) optimism and secrecy
Compared to the European Union, the North American Free Trade Agreement
________.
A) has a stronger currency linkage due to the U.S. dollar
B) has more trade problems since it is a customs union
C) is significantly larger in population and total GNI
D) is slightly smaller in population and GDP
Neoclassical structures attempt to minimize boundaries between all of the following
EXCEPT ________.
A) vertical ranks and functions
B) horizontal units in different areas
C) the firm and its suppliers
D) the firm and its competitors
If the euro continues to remain strong against the U.S. dollar, which of the following
strategies would make the most sense for BMW?
A) It might be advantageous for BMW to consider exporting from Germany to the
United States to take advantage of cheaper costs.
B) It might increase its manufacturing capacity in the United States to take advantage of
the cheaper dollar.
C) It might consider raising prices in the United States to earn more profits for BMW.
D) It really doesn’t make any difference to BMW since consumers will buy the cars no
matter what they cost.
Which legislation has forced companies to establish more stringent internal controls
over their financial reporting?
A) Davis-Bacon Act
B) Sarbanes-Oxley Act
C) Norris-LaGuardia Act
D) McCarran-Ferguson Act
An example of a first-mover advantage in international operations is ________.
A) gaining economies of scale at a lower output level than competitors
B) increasing sales response functions and customer service
C) using a small country for market tests prior to entering a large country
D) lining up the best suppliers and distributors before competitors enter the market
Country A and Country B make an agreement to cooperate more closely and implement
tariff reductions. Which of the following best describes this agreement?
A) double commodity integration
B) multilateral integration
C) regional integration
D) bilateral integration
________ refers to a political system in which government is organized by and
accountable to the people.
A) Totalitarianism
B) Fascism
C) Socialism
D) Democracy
Sources of influence on accounting standards and practices include all of the following
EXCEPT ________.
A) capital markets
B) regulatory environment
C) cultural environment
D) levels of exports
A kanban system is best described as a system that ________.
A) uses special locations for storing imported inventory to avoid paying duties
B) seeks to improve quality by setting a rigorous goal of zero defects
C) electronically links together suppliers, customers, and intermediaries
D) facilitates JIT by using cards to control the flow of production through a factory
Analysts conclude that the finite supply of natural resources will most likely ________.
A) cause a higher proportion of world trade to occur among developed countries
B) cause a higher proportion of world trade to occur among developing countries
C) serve as an advantage for developing countries in their sales to developed countries
D) create a greater portion of world trade in the form of services
Chapman Enterprises is an MNE that markets a diverse portfolio of products including
jewelry, luggage, and furniture. Which structure would most likely be used by
Chapman?
A) international division
B) functional division
C) geographic division
D) product division
Which of the following has MOST influenced consumers to demand access to
foreign-made products?
A) Declining global affluence has caused consumers to seek out lower-priced products
from abroad.
B) Consumers have become more efficient in using media and technologies to compare
prices worldwide.
C) Fearing that their governments will enact restrictive policies on imports, consumers
are stocking up on foreign products before restrictions are put in place.
D) Expectations of rising prices of foreign products have caused consumers to seek
foreign products before their prices become prohibitive.
According to purchasing power parity, if the domestic inflation rate is ________ than
that in the foreign country, the domestic currency should be ________ than that of the
foreign country.
A) lower; weaker
B) higher; higher
C) lower; stronger
D) higher; stronger
Which of the following most accurately compares the techniques of scanning versus
detailed analysis of countries?
A) Scanning is used for planning and detailed analysis is used for control.
B) Detailed analysis is used to consider countries overlooked in the scanning process.
C) Scanning considers a large number of countries so that only the most promising ones
undergo a detailed analysis.
D) Scanning compares one country to another, whereas detailed analysis compares
regions within a single country.
A company’s operations are most likely to be taken over by a host government when
________.
A) the operations are relatively small and, thus, unlikely to incur the wrath of the
company’s home government
B) the operations are substantial and have a widespread effect on the country because of
the company’s size
C) the host country becomes involved in a regional war
D) the firm produces discretionary rather than essential products