1) during the past decade, countries with high individualism and low confucian
dynamics such as the united states have attained high growth rates.
2) culture is static.
3) countertrade contracts may involve the exchange of poor-quality goods that the firm
cannot dispose of profitably.
4) overpayment for assets of an acquired firm is one reason acquisitions fail.
5) franchising enables a firm to quickly build a global presence.
6) an mne can build strategic flexibility and reduce economic exposure by contracting
out manufacturing.
7) a key benefit resulting from the adoption of the euro is the ability to compare prices
across member markets.
8) it is not possible to conduct business nearly all over the world using only english.
9) _____ is an export specialist who acts as the export marketing department or
international department for its client firm.
a.an eximbank
b.an import trading company
c.a sogo shosha
d.an export management company
10) the _____ suggests that given relatively efficient markets, the price of a “basket of
goods” should be roughly equivalent in each country.
a.theory of efficient markets
b.law of one price
c.theory of price inflation
d.ppp theory
11) firms based in _____ accounted for 14.7 percent of the stock of foreign direct
investment in 2007, up from only 1.1 percent in 1980 .
a.asia
b.developing countries
c.united kingdom
d.nafta region
12) identify the incorrect statement about a common market.
a.it has no barriers to trade between member countries
b.it includes a common external trade policy
c.it establishes a central political apparatus coordinating the economic, social, and
foreign policy of the member states
d.it allows factors of production to move freely between members
13) assuming the 30-day forward exchange rate were $1 = 130 and the spot exchange
rate were $1 = 120, the dollar is selling at a _____ on the 30-day forward market.
a.premium
b.margin
c.discount
d.subsidy
14) firms should build a strong corporate culture and an informal management network
for transmitting information and knowledge within the organization if they are pursuing
a(n):
a.transnational strategy
b.localization strategy
c.global standardization strategy
d.international strategy
15) when a channel is exclusive:
a.it carries only high-end products
b.it is controlled by market leaders or by firms who have a niche market
c.it focuses only on elite customers
d.it is often difficult for a new firm to get access to shelf space in supermarkets
16) globalization has _____ the opportunities for a firm to expand its revenues by
selling around the world and _____ its costs by producing in nations where key inputs
are cheap.
a.reduced, reduced
b.increased, increased
c.increased, reduced
d.reduced, increased
17) the payment of dividends is an attractive option:
a.when the rate of tax levied on dividends by the host-country government is high.
b.for subsidiaries based in “high-risk” countries.
c.for newly established subsidiaries.
d.when local equity participation is limited.
18) the relationship between a country’s relative inflation rates and changes in exchange
rates is:
a.much closer than what theory would predict.
b.not reliable in the short run.
c.totally reliable in the long run.
d.according to empirical studies, non existent in the long run.
19) budgets and capital spending are the most important _____ in subunits within
multinational firms.
a.cultural controls
b.output controls
c.personal controls
d.bureaucratic controls
20) which of the following does not help create an economic system that is favorable to
international business?
a.decreased privatization
b.widespread deregulation
c.open markets
d.falling trade and investment barriers
21) does new trade theory support government intervention and strategic trade policy?
explain.
22) what are the various types of capital market loans?
23) discuss the arguments for a floating exchange rate system.
24) what are the political reasons for governments to intervene in markets?
25) what is paul krugman’s position on strategic trade policy?
26) discuss why the repatriation process is so difficult for so many expatriates. how
could the difficulties associated with repatriation be alleviated?
27) how do levels of economic development affect consumer behavior? what are the
implications for marketing strategy?