Chapter 05 – The Global Environment
Chapter 05
The Global Environment
Multiple Choice Questions
1. (p. 123) ______ refers to the strategy of pursuing opportunities anywhere in the world that
enable a firm to optimize its business functions in the countries in which it operates.
2. (p. 123) ______ is the use of a common product, service, and message across all markets to
create a strong brand image.
3. (p. 123) ______ is the development of modified products and services, and the use of
somewhat tailor-made messages, to meet the demands of a local population
4. (p. 123) The change in customer _______ behavior was the beginning of an evolution in
international strategy.
5. (p. 123) The 100 largest U.S. global earn an average of ___ percent of their operating profits
abroad.
6. (p. 123) Firms from which country lead the way in “direct foreign investment” in the United
States?
7. (p. 124) Overall, in less than 20 years, ______ countries will be overshadowed by ______
countries in their produced share of the world’s output.
8. (p. 124) Which country is expected to have a commanding lead in the size of its economy by
2020?
9. (p. 124) The evolution of a global corporation often entails progressively involved strategy
levels. What level has the minimal effect on existing product lines?
10. (p. 124) Firms at what strategy level are called multinational corporations (MNCs)?
11. (p. 124) Which of these represent the second level in the evolution of a global corporation?
12. (p. 124) MNCs are involved mainly in which of the following strategies?
13. (p. 124) At what level do firms begin to emerge as global enterprises with global approaches
to production, sales, finance, and control?
14. (p. 124) The most involved strategy level in the evolution of a global corporation in
characterized by
15. (p. 126) In the past 30 years, the U.S. has ______ in terms of technological advantage.
16. (p. 126) Which country leads in chemicals and pharmaceuticals, precision and heavy
machinery, heavy electrical goods and surface transport equipment?
17. (p. 126) ______ leads in optics, solid-state physics, engineering, chemistry and process
metallurgy.
18. (p. 124) Direct penetration of foreign markets makes sense as a competitive weapon because
a firm can drain vital ____ from a foreign competitor’s domestic operations.
19. (p. 127) A(n) ______ orientation believes that the values and priorities of the parent
organization should guide the strategic decision making of all its operations.
20. (p. 127) Which one of the following is NOT a strategic orientation of global firms?
21. (p. 127) If a corporations has a(n) ______ orientation, then the culture of the country in
which a strategy is to be implemented is allowed to dominate the decision-making process.
22. (p. 127) A(n) ______ orientation exists when the parent attempts to blend its own
predisposition with those of the region under consideration.
23. (p. 127) A company with a ______ orientation adopts a global systems approach to strategic
decision making, thereby emphasizing global integration.
24. (p. 127) A firm with a _______ orientation adopts a global systems approach to strategic
decision making, thereby emphasizing global integration.
25. (p. 127) American firms often adopt a ______ orientation for pursuing strategies in Europe.
26. (p. 128) In which of these orientations is governance top-down?
27. (p. 128) In which of these orientations is governance bottom-up?
28. (p. 128) In which of these orientations are we likely to see hierarchical product divisions?
29. (p. 128) In which of these orientations is repatriations of profits to home country a key
priority?
30. (p. 128) In which of these orientations is national responsiveness a key strategic priority?
31. (p. 128) ______ countries maintain their stability by restricting the flow of money, goods,
services, people, and information across their borders.
32. (p. 128) Closed countries typically have _______ policies.
33. (p. 127) External and internal assessments are conducted ______ a firm enters global
markets.
34. (p. 128) Understanding the ______ risk involved is a key element in the decision to do
business in a foreign nation.
35. (p. 127) Careful examination of critical global environmental features with particular
attention to the status of the host nation is called:
36. (p. 127) Repatriation of profits to home country represents which orientation of a global
firm?
37. (p. 127) Host country culture is a dominant factor in which orientation of a global firm?
38. (p. 127) Global personnel development and placement occurs in which orientation of a global
firm?
39. (p. 127) Top-down governance structure is evident in which orientation of a global firm?
40. (p. 129) Internal assessment involves identification of the basic ______ of a firm’s
operations.
41. (p. 130) Political factors in choosing a foreign manufacturing site include:
42. (p. 130) Business International Corporation recommends that 7 broad categories of factors be
considered in a corporation’s assessment of a foreign manufacturing site. Which of the
following described one of these categories?
43. (p. 130) According to Business International Corporation, the variables to be included under
capital-source factors include:
44. (p. 130) Which of the following is NOT a geographic factor in choosing a foreign
manufacturing site?
45. (p. 130) According to Business International Corporation, variables to be included under
labor factors include:
46. (p. 130) State of marketing and distribution systems is a variable included under which
category (as outlined by Business International Corporation)?
47. (p. 130) Which one of the following is NOT a factor that contributes to the increase in
complexity of the global environment?
48. (p. 131) The demands placed on the global firm by the foreign environments in which it
operates, principally by foreign governments is called
49. (p. 133) A ______ is one in which competition is essentially segmented from country to
country.
50. (p. 133) Factors that increase the degree to which an industry is multidomestic include: