Firms use foreign trade zones to ________.
A) consolidate market monopolies
B) assemble foreign dutiable materials and components into finished products, which
are then re-exported
C) create employment opportunities for the local people
D) meet quota demands established by the government
________ is the tendency of investors to mimic each others’ actions.
A) Switch trading
B) Dumping
C) Momentum trading
D) Herding
Using one’s own culture as a standard for judging other cultures is known as ________.
A) anthropocentric orientation
B) ethnocentric orientation
C) geocentric orientation
D) polycentric orientation
Which of the following refers to an advantage for firms that adapt a unique marketing
program for an individual market?
A) By doing so, firms decrease their reliance on foreign market intermediaries for large
sales.
B) By doing so, firms scale up production substantially to meet the needs of a large and
growing market.
C) Products are tailored to specifically meet the exclusive needs of customers in that
market.
D) Governments provide heavy tax reliefs to firms that modify products and services.
Nations pursuing regional integration seek to ________.
A) increase the scale of the marketplace for firms inside the economic bloc
B) help firms increase the scale of operations and enhanced productivity
C) attract direct investment from outside the bloc
D) all of the above
Sustainable firms ________.
A) have a high employee turnover rate
B) have greater liabilities than assets
C) avoid emitting toxic wastes
D) actively resist organizational change
Which of the following best characterizes the development of international business?
A) It has existed in some form for centuries.
B) It first started in Europe.
C) It developed after the year 2000.
D) Its development has slowed in recent years.
Which of the following represents a human resource factor that firms must consider
when selecting an FDI location?
A) intellectual property protection
B) transparency and corruption
C) extent of bureaucracy and red tape
D) involvement of labor unions
When using the process of gradual elimination to screen potential country markets, a
researcher should first, ________.
A) delve into specific information
B) obtain general information on macro-level indicators like population
C) employ specific indicators, such as import statistics
D) narrow down the choices with specific indicators, such as economic growth
The ________ is the level of regional integration that remains an ideal and is yet to be
achieved.
A) free trade area
B) common market
C) political union
D) customs union
Which of the following should be considered before the government takes any action to
correct the high rate of inflation?
A) What have been the historical consequences of trade barriers in Country X?
B) What is the current price of coffee in the United States and Europe?
C) What will be the long-term effects of currency depreciation to Country X?
D) What other industries in Country X could replace agriculture?
International Management Position (Scenario)
Global Choppers Inc. is an MNE based in Vancouver that manufactures high-quality
motorcycles for sale around the world. The majority of design work is done at the
Vancouver headquarters, but manufacturing and assembly are performed in company
facilities located in Romania. In order to maintain control over manufacturing quality,
Global Choppers sends representatives from the company headquarters to manage the
Romanian facility for one year rotations. Conrad O’Neil has been selected to run the
foreign facility for the upcoming year. The human resources department of Global
Choppers will be preparing him for his foreign assignment through a variety of training
methods.
Conrad’s training for his assignment in Romania would most likely include ________.
A) technical training
B) area studies
C) training on developing global managers
D) natural disaster management
In a system franchising agreement, the franchisor provides ________.
A) down-payment plus royalty
B) production and marketing methods
C) lump-sum payment
D) sale of related products
________ refers to lowering the cost of the firm’s operations and activities on a global
scale.
A) Efficiency
B) Protectionism
C) Flexibility
D) Currency control
An idiom ________.
A) refers to the objective analysis of a situation
B) refers to the perception about someone or something that may or may not be true
C) is a highly ambiguous rhetoric device used in high-context cultures
D) is an expression whose symbolic meaning is different from its literal meaning
________ are moral principles and values that govern the behavior of people, firms, and
governments, regarding right and wrong.
A) Attitudes
B) Ethics
C) Laws
D) Biases
Which of the following is an example of a location-specific advantage?
A) managerial skills
B) skilled labor
C) proprietary knowledge
D) the ability to reduce buyer uncertainty
Phone Center (Scenario)
The Technix Computer Corporation recently finished construction of a customer service
phone center in New Delhi, India. Phone center agents will be responsible for
answering technical questions from customers around the globe. Technix has hired 55
local computer experts as phone agents, and a training session is underway. Technical
specialists and call center specialists from the United States have flown to India to train
the new Indian employees. Hank Patelli, a senior manager of a Technix phone center in
Michigan, will oversee the New Delhi phone center for six months until a local
manager is hired and trained to replace him.
After the first training session, a number of the Michigan employees expressed
frustration that the Indian employees lacked technical knowledge because none of them
asked questions or offered answers. Which of the following would be the best way for
Hank to handle the situation?
A) Remind the American employees that the Indians may be showing respect by
remaining silent.
B) Order the Indian employees to interact more during the session.
C) Host a traditional American barbeque so the American and Indian employees can get
acquainted.
D) Ignore the complaints of the American employees and continue the training sessions
as planned.
Which of the following statements is true of country risk?
A) Its nature remains constant over time and across nations.
B) Its intensity seldom varies over time and across nations.
C) It is present only in poor nations.
D) It is always present.
Samsung is an example of a family conglomerate based in South Korea.
When a firm allows others to use an entire business system in exchange for
compensation, the arrangement is known as ________.
A) industrial design rights
B) franchising
C) joint venture
D) equity venture
Which of the following issues most likely complicates international human resource
management?
A) equal education opportunities
B) health benefit reimbursement
C) political risk and terrorism
D) vacation and travel policies
Gray marketers are ________.
A) typically large business conglomerates
B) unauthorized intermediaries
C) authorized distributors
D) a firm’s most effective promotional channels
With regard to the iceberg concept of culture, ________ is the most deeply embedded.
A) conversational patterns
B) cooking
C) courtship practices
D) literature
Which of the following measures would a progressive firm most likely take to ensure
female equality in international business?
A) encourage senior executives to learn multiple foreign languages
B) limit the number of female executives for international executive posts
C) deny leadership roles in foreign assignments to men
D) have female executives serve as mentors and role models for aspiring women
The problem of end-user prices reaching exorbitant levels in the export market, caused
by multilayered distribution channels, intermediary margins, tariffs, and other
international customer costs is known as ________.
A) international price escalation
B) incremental pricing
C) standardization
D) puffery
Which of the following activities would be considered last by a manager while
developing strategies?
A) analyzing the particular challenges that confront the firm
B) deciding how best to contend with competitors
C) examining the firm’s specific strengths and weaknesses
D) analyzing the particular opportunities for the firm
Net present value is defined as the ________.
A) combined value of the capital assets of a project and the sales projections
B) difference between the present value of a firm’s assets and the future project
liabilities
C) difference between the present value of a project’s incremental cash flow and the
initial investment
D) combined value of a project’s initial investment and its incremental cash flow
An arrangement in which the firm allows another the right to use an entire business
system in exchange for fees, royalties, or other forms of compensation is known as
________.
A) franchising
B) licensing
C) outsourcing
D) offshoring
Coordinating the international value-chain activities of a firm across multiple countries
to achieve maximum efficiency is known as ________.
A) local responsiveness
B) global integration
C) adaptation
D) country-by-country responsiveness