Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
e. economic barriers
44. Which moves beyond the ordered, staged approach of Internationalization Theory to focus
solely on the reasons a company’s leaders select a specific type of entry mode?
a. internalization theory
b. global trade theory
c. economic selection theory
d. theocratic operations theory
e. multinational selection theory
45. Eclectic Theory assumes that which mode of entry is most efficient?
a. exporting
b. licensing
c. joint venture
d. strategic alliance
e. wholly owned subsidiary
46. Which can be thought of as explaining the “why” of multinational corporation foreign
activities according to Eclectic Theory?
a. resource advantages
b. demand advantages
c. supply advantages
d. ownership advantages
e. asset advantages
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
47. According to Eclectic Theory, which represents anything that a company does well?
a. resource advantages
b. demand advantages
c. supply advantages
d. ownership advantages
e. asset advantages
48. Which can be thought of as the “how” of market entry according to Eclectic Theory?
a. resource advantages
b. demand advantages
c. internalization advantages
d. internationalization advantages
e. asset advantages
49. When selecting a mode of entry, which represents reduced costs per item due to increased
production?
a. risk
b. uncertainty
c. economics of scale
d. rivalries
e. new entrants
50. Which advantages relate to the ability to capture transactional benefits, such as lower costs?
a. transaction ownership
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
b. transaction equity
c. transaction accounting
d. transaction settlement
e. transaction offering
51. Economic systems dictate the distribution of resources to members of a society.
a. True
b. False
52. A free and competitive marketplace means the government does not interfere with prices.
a. True
b. False
53. Capitalism is considered to be a type of market economy.
a. True
b. False
54. Socialism refers to economic systems where the state owns at least some parts of industry.
a. True
b. False
55. The updated categorization of economic development that is accepted by the United Nations
includes first-, second-, and third-world country designations.
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
a. True
b. False
56. Greater economic development affords an increased number of potential products to be sold
to an expanding number of potential customers.
a. True
b. False
57. A traditional country is a country in which little technology exists and the capital required to
purchase raw materials and create services is not widely available.
a. True
b. False
58. Urbanization occurs during the “take-off” stage of Rostow’s stages of development.
a. True
b. False
59. Development of an economy generally leads to less competition due to monopolization by
very few producers.
a. True
b. False
60. Countries moving through the transformation from developing to developed are termed
emerging markets.
a. True
b. False
61. The term EMM stands for “emerging, mature markets.”
a. True
b. False
62. BRIC countries include Brazil, Russia, India, and Cambodia.
a. True
b. False
63. BEMS, or big emerging markets, are generally unattractive for international marketers due to
limited growth opportunities.
a. True
b. False
64. The Rostow Modernization Model has been criticized for failing to recognize that some
nations have experienced rapid economic expansion.
a. True
b. False
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
65. A NIC is a newly industrialized country.
a. True
b. False
66. Transition economies occur in what were formerly communist countries.
a. True
b. False
67. Transition economies occur in impoverished areas.
a. True
b. False
68. Bottom-of-the-pyramid customers do not offer a valid target market.
a. True
b. False
69. Bottom-of-the-pyramid consumers are most likely to reside in most-developed countries.
a. True
b. False
70. The theory of national competitive advantage provides an explanation for why countries
succeed in certain industries.
a. True
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
b. False
71. The ability to innovate helps establish national competitive advantage.
a. True
b. False
72. One factor in Porter’s theory of national competitive advantage is the government.
a. True
b. False
73. One of Porter’s Five Forces is the threat of price increases.
a. True
b. False
74. Widely accessible knowledge and processes result in more rivalry among competitors than
does specialized knowledge.
a. True
b. False
75. One way of lessening the bargaining power of suppliers is to buy the supplier in question.
a. True
b. False
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
76. The existence of substitute products increases competitive intensity in an industry.
a. True
b. False
77. Industries with a relatively small number of buyers face increased customer power.
a. True
b. False
78. Economic growth usually means more complex marketing infrastructures.
a. True
b. False
79. Risk is not a factor that influences entry mode selection.
a. True
b. False
80. The growth of the Internet has made the direct-sales approach increasingly difficult for
international marketers.
a. True
b. False
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
81. A contractual agreement that allows one company to use another’s brand, image, and other
marketing components is a license.
a. True
b. False
82. In a franchising agreement, the main risk to a parent company is poor franchise selection.
a. True
b. False
83. A joint venture is essentially a licensing agreement between two companies.
a. True
b. False
84. An acquisition can result only from a franchise agreement.
a. True
b. False
85. Internationalization Theory proposes that companies go through five stages during the move
to becoming completely global.
a. True
b. False
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
86. One underlying assumption of Internalization Theory is that there is no specific advantage
for exporting.
a. True
b. False
87. Greater control of a subsidiary allows company leaders to better respond to risk and
uncertainty.
a. True
b. False
88. Eclectic Theory assumes that exporting is the least efficient form of market entry.
a. True
b. False
89. Eclectic Theory explains the “where” of entry location advantages.
a. True
b. False
90. The presence of local resources is of little consideration in entry mode selection according to
Eclectic Theory.
a. True
b. False
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
91. Compare and contrast the various types of basic economic systems that are discussed in the
text. How do they differ?
92. Describe the stages found in the Rostow Modernization Model. What are some of the
challenges that countries face moving through these stages?
93. Describe the various features of transition economies that have been discussed in the
textbook. How does the level of development present in a country affect international marketing
programs?
94. Define BEMS and BRIC. What are the BRIC countries? What role do they play in
international marketing? Do you think their role will grow or shrink in years to come?
95. Which countries are considered to be newly industrialized countries? List and discuss the
various factors that contribute to the growth of these countries.
96. Discuss each of the five drivers of national competitive advantage that are found in Porter’s
theory. How can each of these factors affect international marketing efforts?
97. Discuss the five competitive forces that apply to international marketing. Using an example
of your choice describe how each of these forces affect international marketing efforts in the
focal industry.
Instructor Resource
Baack et al., International Marketing, 2e
SAGE Publishing, 2019
98. Discuss the six major forms of entry mode that have been discussed in the textbook. Include
the various levels of risk, country, and cost that are associated with each.
99. Discuss Internationalization Theory, Internalization Theory, and Eclectic Theory. Note the
differences and similarities in the theories.
100. Describe the various stages found in Internationalization Theory. What is meant by the
assertion that the theory views going global as being a “process”?