1) fees are usually levied as a percentage of a subsidiary’s gross revenues.
2) according to the un, a typical international trade transaction can involve 50 different
parties.
3) unless there is no alternative, large, diverse multinational enterprises should probably
try to avoid countertrade deals.
4) muslim countries are likely to be receptive to international business as long as those
businesses behave in a manner that is consistent with islamic ethics.
5) a central reason for the establishment of the eu was a strong desire on the part of
member countries to hold their own on the world’s political and economic stage.
6) the greatest advantage of buying component parts from independent suppliers is that
the firm can maintain its strategic flexibility.
7) the asian meltdown began in mid-1997 in japan when it became clear that several
key japanese financial institutions were on the verge of default.
8) support activities are always less important than the primary activities in achieving a
competitive advantage.
9) the impact of the iasb standards has probably been least noticeable in the united
states because of policy directives that direct u.s. public companies to adhere to
domestic standards.
10) the amount of fdi undertaken over a given time period is known as the flow of fdi.
11) in ethnocentric firms, the lack of managers’ mobility among national operations
implies that pay can and should be kept country-specific.
12) when a tourist goes to a bank in a foreign country to convert money into the local
currency, the exchange rate used is the spot rate.
13) it is not possible to have democratic societies that emphasize a mix of collectivism
and individualism.
14) there is a global trend of societies shifting from individualism toward collectivism.
15) under the _____ of 1987, the group of five agreed that exchange rates had realigned
sufficiently from earlier levels and pledged to support the stability of exchange rates
around their current levels by intervening in the foreign exchange market when
necessary.
a.plaza accord
b.jamaica agreement
c.louvre accord
d.bretton woods agreement
16) which among the following is a concern of organized labor regarding multinational
firms?
a.a company can counter a union’s bargaining power with the power to move
production to another country
b.an international business will keep low-skilled tasks in its home country and farm out
only highly skilled tasks to foreign plants
c.an international business can attempt to export employment practices and contractual
agreements to its home country
d.a multinational company is more likely to receive government support in the case of
hostile labor relations
17) the most global markets currently are markets for:
a.services
b.consumer goods
c.consumer durables
d.industrial goods
18) _____ are social conventions concerning things such as the appropriate dress code
in a particular situation, good social manners, eating with the correct utensils,
neighborly behavior, and the like.
a.values
b.beliefs
c.mores
d.folkways
19) what is the drawback of using a letter of credit system?
a.the exporter is no longer entitled to preexport financing
b.the importer no longer trusts the exporter
c.the exporter is not guaranteed any payment
d.the importer must pay the bank a fee for the letter of credit
20) japanese exporters get assistance in identifying export opportunities from:
a.miti
b.the japanese outreach program
c.guanxi
d.chaebol
21) the righteous moralist suggests that:
a.ethics are nothing more than the reflection of culture
b.a multinational’s home-country standards of ethics are the appropriate ones for
companies to follow in foreign countries
c.the social responsibility of business is to increase profits, so long as the company
stays within the rules of law
d.if a manager of a multinational sees that firms from other nations are not following
ethical norms in a host nation, that manager should not either
22) according to the text, superior enterprise profitability requires all of the following
conditions to be fulfilled except:
a.the different elements of a firm’s organizational architecture must be internally
consistent
b.the organizational architecture must match the strategy of the firm
c.the strategy and architecture of the firm must not only be consistent with each other,
but also consistent with the competitive environment of the firm
d.the firm’s formal organizational structure must revolve around the indigenous
population in each subunit
23) which of the following is not one of the main variables that influence the
development of a country’s accounting system?
a.the relationship between individuals and social groups
b.political and economic ties with other countries
c.the level of inflation
d.the prevailing culture in a country
24) _____ involves trading goods and services for other goods and services when they
cannot be traded for money.
a.countertrade
b.forfeiting
c.a sight draft
d.a time draft
25) this allows the company to produce a wider variety of end products at a unit cost
that at one time could be achieved only through the mass production of a standardized
output.
a.kaizen
b.six sigma
c.lean production
d.tqm
26) according to the concept of economies of scale what is the best way to achieve high
efficiency and low unit costs?
a.customizing products for each individual market
b.mass producing standardized outputs
c.concentrating on production of small volumes of products
d.increasing the product variety dramatically
27) identify the incorrect statement pertaining to commercial banks.
a.they perform an indirect connection function
b.they lend investors money to borrowers at a higher rate of interest, making a profit
from the difference in interest rates
c.they bring investors and borrowers together and charge commissions for it
d.they take cash deposits from corporations and individuals and pay them a rate of
interest in return
28) cultural relativism suggests that:
a.ethics are nothing more than the reflection of culture and that a firm should adopt the
ethics of the culture in which it is operating
b.the only social responsibility of business is to increase profits
c.managers of a firm should not make decisions regarding social investments
d.a multinational’s home-country standards of ethics are always appropriate to follow in
foreign countries
29) analysts who believe that the globalization of capital has serious inherent risks
argue that:
a.due to deregulation and reduced controls on cross-border capital flows, individual
nations are becoming more vulnerable to speculative capital
b.most of the capital that moves internationally is pursuing long term gains, and it does
not shift in and out of countries as quickly as conditions change
c.”hot money” is still relatively rare, primarily because although capital is free to move
internationally, its owners and managers still prefer to keep most of it at home
d.the lack of short-term capital is due to the relative paucity of information that
investors have about foreign investments
30) many western firms that sold oil-refining technology to firms in gulf states now find
themselves competing with these firms in the world oil market. this is an example of:
a.the firm entering into a turnkey project with a foreign enterprise, inadvertently
creating a competitor
b.the firm entering into a turnkey deal having no long-term interest in the foreign
country
c.the country subsequently proving to be a major market for the output of the process
that has been exported
d.selling the firm’s process technology through a turnkey project which is also selling
competitive advantage to potential competitors
31) which of the following states that the bank will pay a specified sum of money to a
beneficiary on presentation of particular, specified documents?
a.a draft
b.a bill of lading
c.a letter of credit
d.a promissory note
32) identify the tree types of economic systems. how do the three types of economic
systems differ from each? how are they the same?
33) who was w. edward deming? what is his contribution to business?
34) what is the foreign corrupt practices act? what is its purpose?
35) what are the financial advantages that make the eurocurrency market attractive to
both depositors and borrowers?
36) should a multinational feel free to pollute in a developing nation?
37) discuss the effect of country factors on the decision of where to locate production?
38) what are cash balances? why are they important for a firm?
39) discuss the relationship between a firm’s control systems and a firm’s incentive
system. why is this relationship important?