1) Regional integration deals in Africa show the least amount of protectionism in
international trade.
2) The theory of purchasing power parity suggests that in the absence of trade barriers,
the price for identical products sold in different countries will be different.
3) Semiglobalization is primarily caused by the practice of total isolation.
4) An institution-based view suggests that the success and failure of firms are enabled
and constrained by business norms of the host nation.
5) Explicit knowledge is noncodifiable and its transfer requires hands-on practice.
6) Reverse innovations are innovations that are adopted first in the Triad-based
multinationals and then diffused around the world.
7) Adopting the Paris Convention is required in order to become a signatory country to
the WTOs Agreement on Trade-Related Aspects of Intellectual Property Rights.
8) The current state of globalization around the world is that of semiglobalization.
9) In socially mobile societies, education functions as a means to maintain social
stratification.
10) Dividing individuals of a society into hierarchical classes is an example of social
stratification.
11) _____ is the relationship among various participants in determining the direction
and performance of corporations.
a. Corporate citizenship
b. Corporate social responsibility
c. Corporate conscience
d. Corporate governance
12) _____ is the amount of FDI moving in a given period (usually a year) in a certain
direction.
a. FDI stock
b. FDI flow
c. Horizontal FDI
d. Vertical FDI
13) ____ refers to the expenditures a customer is willing to pay for a product.
a. Total cost
b. Price
c. Total cost of ownership
d. Price elasticity
14) Which of the following corporate social responsibilities is recommended for MNEs
by the UN?
a. Respect the rights for employees to engage in collective bargaining
b. Refrain from improper or illegal involvement in local politics
c. Respect human rights and fundamental freedoms in host countries
d. Provide reasonable terms and conditions when granting licenses for industrial
property rights
15) Which theory is based on the notion that competitive advantage is dependant on the
four interacting aspects of factor endowments, domestic demand, firm strategy, and
related and supporting industries?
a. Strategic trade theory
b. Product life cycle theory
c. Comparative advantage theory
d. National competitive advantage of industries theory
16) Which of the following is an effect of adopting the euro as a currency for EU
members?
a. It implements independent monetary policies for each nation
b. It provides unlimited flexibility in fiscal policy making
c. It increases currency conversion costs
d. It facilitates direct and transparent price comparison
17) Which of the following is an advantage of using the balance sheet approach of
compensation?
a. It does not create disparity in pay between expatriates and HCNs
b. It creates less fluctuation between overseas and parent country pay during
repatriation
c. It is organizationally less complex to administer
d. It is the cheapest method of managerial compensation for expatriation
18) Who benefits the most from the acquisition premium valued during an acquisition?
a. The shareholders of the acquiring firm
b. The shareholders of the target firm
c. The opportunistic partner
d. The partner who possesses hard-to-imitate capabilities
19) _____ refers to price setting at a level higher than the competitive level by
monopolists.
a. Collusive price setting
b. Predatory pricing
c. Dumping
d. Mark-up pricing
20) Which of the following is one of the underlying motivations behind MNEs
voluntary “green practices”?
a. CSR demands satisfied by customers in developing countries
b. Strong military and legal supervision in the host countries
c. Requirements of MNE headquarters for worldwide compliance of higher CSR
standards
d. Constant interference in collective bargaining
21) _____ are politically motivated trade sanctions against foreign countries to signal
displeasure.
a. Trade embargoes
b. VERs
c. Subsidies
d. Antidumping duties
22) Which of the following is considered as a tangible resource of a firm?
a. The research and developmental capabilities of a firm
b. The organizational culture of a firm
c. The copyrights that belong to a firm
d. The reputation of a firm as being socially responsible
23) Capital flight is a phenomenon in which a large number of individuals and
companies exchange _____.
a. domestic goods for gold
b. gold for domestic goods
c. foreign currency for a domestic currency
d. domestic currency for a foreign currency
24) Which of the following is an advantage of a strong US dollar?
a. US importers will find it easier to compete with low-cost imports
b. US exporters will find it easier to compete on price abroad
c. US firms will experience less competitive pressure to keep prices low
d. US tourists will find it more expensive when traveling abroad
25) ____ requires firms to continuously monitor major geopolitical, social, and
technological trends in the world, and reconfigure the supply chain accordingly.
a. Agility
b. Adaptability
c. Alignment
d. Aggregation
26) Which of the following is true of the GLOBE clusters?
a. It divides all the nations of the world into western and eastern cultures
b. It divides the nations of the world into ten clusters
c. It divides the nations of the world based on civilizations
d. It divides the nations of the world based on their religious affinity
27) _____ are the most direct denial of absolute or comparative advantage.
a. Quotas
b. Tariffs
c. Local content requirements
d. Subsidies
28) The _____ suggests the price for identical products in different countries would be
the same, if trade barriers are absent.
a. theory of purchasing power parity
b. fixed exchange rate policy
c. Penn effect
d. Bretton Woods system
29) ____ is a way to reach overseas customers by exporting through domestic-based
export intermediaries.
a. Direct exports
b. Licensing
c. Indirect exports
d. Letters of credit
30) _____ are government payments to domestic firms.
a. Tariffs
b. Subsidies
c. Quotas
d. Trade embargoes
31) The combination of operations and management of two firms to establish a new
legal entity is called a(n) _____.
a. joint venture
b. merger
c. contractual alliance
d. acquisition
32) Which of the following industry characteristics contributes to collusion?
a. Existence of an industry price leader
b. Existence of many firms in the market
c. Low barriers to entry
d. Lack of market commonality
33) Which of the following is true of the customs unions in South America?
a. The Andean Communitys largest trading partner is China
b. Mercosur is more pro-free trade than the Andean Community
c. Andean Community and Mercosur countries are today integrated into the FTAA
d. Mercosur is relatively more protectionist than the Andean Community
34) Which of the following is a part of the VRIO framework?
a. Value
b. Reliability
c. Impulse
d. Orientation
35) Which of the following is one of the major reasons the gold standard was
abandoned?
a. The increased flow of gold from the U.S. into foreign central banks
b. The competitive devaluation of currencies during the Great Depression
c. The strengthening of the U.S. dollar due to the rise in productivity levels in the
United States
d. The United States unilaterally announced that the dollar would not be convertible to
gold
36) _____ are restrictions on the quantity of imports.
a. VERs
b. Import quotas
c. Subsidies
d. Antidumping duties
37) _____ refers to the quality of a society that perceives its own culture, ethics, and
norms as natural, rational, and morally right.
a. Polycentrism
b. Ethnocentrism
c. Anthropocentrism
d. Social mobility
38) A(n) _____ refers to a group of countries that use a common currency.
a. political union
b. customs union
c. monetary union
d. trade union
39) Which of the following political views treats FDI as an instrument of imperialism
and as a vehicle for exploitation of domestic resources by foreign capitalists and firms?
a. Pragmatic nationalism
b. The free-market view
c. The radical view
d. The monopolistic view
40) _____ refers to the total accumulation of inbound FDI in a country or outbound FDI
from a country.
a. FDI flow
b. FDI stock
c. Horizontal FDI
d. Vertical FDI
41) _____ is a type of FDI in which a firm duplicates its home country-based activities
at the same value chain stage in a host country.
a. Horizontal FDI
b. Vertical FPI
c. Backward vertical FDI
d. Platform FDI
42) The television industry in the United States is controlled by seven giant
corporations: The Walt Disney Company, CBS Corporation, Viacom, Comcast, Hearst
Corporation, Time Warner, and News Corporation. Thus, the television industry in the
U.S. is a typical _____ industry.
a. agglomeration
b. free market
c. monopolistic
d. oligopolistic
43) In _____, clients pay contractors to design and construct new facilities and train
personnel.
a. franchising
b. turnkey projects
c. licensing
d. co-marketing
44) Other than families, the state is another major owner of firms around the world.
45) Externally, MNEs are subject to the formal institutional frameworks erected by
various home-country and host-country governments.
46) Since the 1980s, American managers have become much more focused on stock
prices, resulting in ‘shareholder capitalism.”
47) Performance appraisal only entails the evaluation of employee performance for
performance.
48) List some corporate social responsibilities with regard to employment practices,
recommended for multinational enterprises by some international organizations.
49) A psychological contract is a written contract signed by the employer and the
expatriation candidate.
50) The geographic area structure is appropriate for a transnational strategy.
51) A defensive strategy would only respond to CSR causes when required by disasters
and outcries.
52) Whether entrepreneurship is facilitated or retarded significantly depends on formal
institutions governing how entrepreneurs start up new firms.