53. Exporting, licensing, and direct investing are called strategies because they represent alternative ways to sell
products and services in foreign markets.
a. globalized
b. expansion
c. retrenchment
d. market entry
e. concentrated business
54. As a first step into international business, which two countries are most companies going to today?
a. Russia and Japan
b. Sweden and Germany
c. China and India
d. Brazil and Philippines
e. Indonesia and Brazil
55. is the most widespread approach to international involvement in China and India.
a. Importing
b. Exporting
c. Manufacturing
d. Outsourcing
e. Greenfield venture
56. Franchising is a form of which of these?
a. Direct investing
b. Licensing
c. Exporting
d. Countertrade
e. Barter trade
57. CRL, a European plastics manufacturer, is considering forming an alliance with a U.S. military goods manufacturer
to develop a new type of polymer that can be used for international industrial and military applications. Such a
partnership represents what type of direct investment?
a. Franchising
b. Joint Venture
c. Wholly owned affiliate
d. Greenfield venture
e. Outsourcing
58. Your company is interested in producing and marketing a line of coffee that will penetrate the Chinese market.
Your firm is willing to supply the equipment, products, product ingredients, trademark, and standardized operating
system to entrepreneurs. What type of strategy are you going to use?
a. Wholly owned foreign affiliate
b. A greenfield venture agreement
c. A franchise
d. An export agreement
e. Barter trade
59. Which of the following pairs of alternatives closely resemble each other in the amount of ownership, control and
risk obtained in operating international businesses?
a. Direct investment/franchising
b. Wholly owned foreign affiliate/countertrade
c. Exporting/licensing
d. Franchising/licensing
e. All of these
60. A foreign subsidiary over which an organization has complete control is called a:
a. joint venture.
b. licensing agreement.
c. franchise.
d. wholly owned foreign affiliate.
e. foreign venture.
61. The Write Pens, Inc. wants to reduce transferring costs by producing closer to the consumer in a foreign country.
This will also help in reducing transportation and storage costs. Which strategy would be the best to use given the
circumstances?
a. Franchising
b. Exporting
c. Direct investing
d. Barter agreement
e. Licensing
62. The management of business operations conducted in more than one country is called:
a. global management.
b. international management.
c. outsourcing management.
d. planning management.
e. domestic management.
63. aspects of management do not change when doing business internationally.
a. Planning
b. Organizing
c. Controlling
d. Leading
e. All of these
64. Language, values, religion, and education all describe which dimension in the international environment?
a. Economic
b. Legal
c. Political
d. Sociocultural
e. Technological
65. In international operations, the economic environment represents all of the following factors except:
a. infrastructure.
b. resource and product markets.
c. laws and regulations.
d. inflation.
e. exchange rates.
66. Resource development, infrastructure, and exchange rates all describe which dimension in the international
environment?
a. Economic
b. Legal
c. Political
d. Sociocultural
e. Technological
67. In international operations, the economic environment includes:
a. shared knowledge, beliefs and values.
b. political risks.
c. social organizations.
d. infrastructure.
e. tariffs, quotas, and taxes.
68. is normally used to classify countries as developed or developing.
a. Exchange rates
b. Interest rates
c. Gross national product
d. Per capita income
e. Inflation rates
69. Your grocery store in India is having trouble getting the local farmers to supply you with the proper produce. This is
a problem with India’s:
a. product market.
b. resource market.
c. infrastructure.
d. economy.
e. power distance.
70. generally are located in Asia, Africa and South America.
a. MNCs
b. EUs
c. LDCs
d. WTOs
e. MFNs
71. Exchange rates are included in which of the following international environments?
a. The legal-political sector
b. The economic environment
c. The sociocultural environment
d. The barter system environment
e. The government sector
72. A country’s physical facilities that support economic activities make up its .
a. resource markets
b. infrastructure
c. physical markets
d. product markets
e. plants and equipment
73. If you built a computer company in Africa and then found that your product was having difficulty being distributed
to customers because of the road system, your problem would be related to:
a. an inadequate infrastructure.
b. an economy incapable of supporting growth.
c. a poor resource market.
d. a poor product market.
e. none of these.
74. The legal-political environment, in international operations, includes which of the following?
a. Shared knowledge, beliefs and values
b. Political risks
c. Social organizations
d. Infrastructure
e. None of these
75. Political risk is defined as an organization’s risk of due to politically based events or actions by host
governments.
a. loss of assets
b. managerial control
c. earning power
d. all of these
e. managerial control and earning power only
76. A company’s risk of loss of assets, earning power, or managerial control due to politically based events or action by
host government is referred to as:
a. MFN.
b. political risk.
c. tariffs.
d. political instability.
e. terrorism.
77. Rooftop International, Inc. buys insurance against host government takeover when investing in foreign countries.
This is an example of which sector of the international environment?
a. Legal-political
b. Sociocultural
c. Technological
d. Economic
e. Infrastructure
78. Which of the following is NOT a legal-political factor in the international environment?
a. Laws and regulations
b. Language
c. Tariffs, quotas, taxes
d. Political risk
e. Government takeovers
79. A foreign terrorist kidnaps your firm’s marketing VP while the VP is in the host country. This is a harsh example
of:
a. economic development.
b. infrastructure.
c. political risk.
d. international law.
e. social risk.
80. A.R.C. is a large non-profit humanitarian aid organization that has been forced to pull out of several African
markets in recent years due to civil wars and large–scale violence. This demonstrates which frequently cited
problem for international companies?
a. Political instability
b. Communist governments
c. Economic instability
d. Political risk
e. Financial risk
81. A nation’s includes the shared knowledge, beliefs and values, as well as the common modes of behavior and
ways of thinking, among members of a society.
a. power distance
b. culture
c. masculinity
d. individualism
e. uncertainty avoidance
82. Which of the following companies place an emphasis on their home countries?
a. Polycentric
b. Geocentric
c. Ethnocentric
d. Global
e. Regiocentric
83. refers to the degree to which people accept inequality in authority among institutions, organizations, and
people.
a. Power distance
b. Uncertainty avoidance
c. Individualism
d. Collectivism
e. Masculinity
84. Organizations whose social values reflect low power distance:
a. are highly autocratic.
b. expect superios to make all the decisions.
c. expect equality in power.
d. avoid uncertainty.
e. none of these.
85. A value that reflects a loosely knit social framework in which individuals are expected to take care of themselves is
called:
a. culture.
b. individualism.
c. ethnocentrism.
d. masculinity.
e. power distance.
86. Jana has a high tolerance for the unstructured, the unclear, and the unpredictable. She can best be described as
having:
a. high uncertainty avoidance.
b. low uncertainty avoidance.
c. high degree of individualism.
d. low degree of individualism.
e. low level of power distance.
87. Collectivist values are represented in the social framework of which of these?
a. The United States
b. Australia
c. Brazil
d. Great Britain
e. All of these
88. refers to a value characterized by people’s intolerance for uncertainty and ambiguity and resulting support
for beliefs that promise certainty and conformity.
a. Power distance
b. Uncertainty avoidance
c. Certainty avoidance
d. Conformity seekers
e. None of these
89. Which of these reflects a cultural preference for cooperation, group decision making, and quality of life?
a. Individualism
b. Collectivism
c. Masculinity
d. Femininity
e. Power distance
90. Which of the following countries possesses a high performance orientation?
a. Israel
b. Sweden
c. Taiwan
d. Russia
e. Venezuela
91. Austria‘s cultural preference is for achievement, heroism, assertiveness, and material success. This would be
considered:
a. power distance.
b. individualism.
c. masculinity.
d. ethnocentrism.
e. collectivism.
92. One of Hofstede’s social values that was developed later is:
a. power distance.
b. uncertainty avoidance.
c. masculinity.
d. collectivism.
e. long-term orientation.