1) One of the advantages of being a first-mover is the opportunity to free ride on
late-mover investments.
2) The VRIO framework differs from SWOT analysis in that the VRIO framework
promotes nonoffshoring.
3) Proposition 1 of the institution-based view specifically concerns bounded rationality.
4) Floating exchange rates are less volatile than fixed rates.
5) Technology spillovers are harmful to host firms and industries.
6) Internalization refers to the replacement of cross-border markets with one firm
locating in two or more countries.
7) Trade deficit occurs when a nation exports more than it imports.
8) The Washington Consensus emphasizes using government intervention over state
ownership in business.
9) Institutional framework only pertains to a firms behavior.
10) If one countrys interest rate is high relative to other countries, the country will
attract foreign funds.
11) Opportunism increases transaction costs.
12) The resource-based view suggests that firms need to take actions deemed legitimate
and appropriate by the various formal and informal institutions governing market
entries.
13) The Bretton Woods system was centered on the British pound as the new common
denominator.
14) The second tier of the global economic pyramid is made up of countries with a per
capita annual income of more than $20,000.
15) The values and beliefs of a culture are examples of a formal institution.
16) The theory of absolute advantage is categorized as a classical theory of international
trade.
17) An advantage of joint ventures is the shared costs, risks, and profits.
18) Governments can ban foreigners and foreign firms from owning assets in certain
strategic sectors.
19) In global business, social complexity refers to the socially intricate and
interdependent ways firms are typically organized.
20) Governments adopting the floating exchange rate policy tend to set the exchange
rate of a currency relative to other currencies.
21) Which of the following is a factor for English being accepted as the global business
language?
a. English speakers have traditionally been more mobile than non-English speakers
b. English is far easier to translate to and from, than any other language
c. English-speaking countries contribute the largest share of global business output
d. English is the largest language in terms of the number of native speakers
22) _____ are exclusive legal rights of authors and publishers to publish and
disseminate their work.
a. Patents
b. Trademarks
c. Copyrights
d. Trade secrets
23) The term “emerging economies” has replaced the term _____.
a. developed countries
b. developing countries
c. Triad markets
d. first-world markets
24) Which of the following is one of the four Ps in the marketing mix?
a. Perfection
b. Promotion
c. Power
d. Perception
25) Which element of knowledge management faces the common problem of employee
turnover?
a. Knowledge inflow
b. Knowledge transmission
c. Knowledge outflow
d. Knowledge retention
26) _____ shows how demand changes when price changes.
a. Price lining
b. Price fixing
c. Price elasticity
d. Price discrimination
27) A(n) _____ strategy is indicated by relatively little or no support by top
management of CSR causes.
a. proactive
b. defensive
c. accommodative
d. reactive
28) The price leaders _____ is defined as sufficient resources possessed to deter and
combat defection.
a. capacity to collude
b. capacity to imitate
c. capacity to punish
d. capacity to compete
29) MNEs pursuing localization strategy typically hire _____ as top managers at local
subsidiaries.
a. parent-country nationals
b. multinationals
c. host-country nationals
d. third-country nationals
30) MNEs interested in a _____ strategy are typically polycentric in nature when
staffing.
a. home replication
b. localization
c. global standardization
d. transnational
31) Individualists differ from collectivists in that individualists are _____.
a. less collaborative with in-group members
b. more collaborative with out-group members
c. more opportunistic when dealing with in-group members
d. less opportunistic with out-group members
32) In the context of governance mechanisms, _____ mechanism refers to shareholders’
willingness to work with managers, usually through the board.
a. exit-based
b. voice-based
c. private equity-based
d. corporate control-based
33) _____ are often labeled independent directors.
a. Managing directors
b. Inside directors
c. Executive directors
d. Outside directors
34) ____ is at the fundamental component required for an entrepreneurial mindset.
a. Firm size
b. Leadership
c. Innovation
d. Financing
35) The ability to successfully manage interfirm relationships is called _____.
a. hubristic capability
b. synergistic capability
c. contractual capability
d. relational capability
36) Which of the following is true of private ownership?
a. It tends to force firms into liquidation due to high competition
b. It empowers the government to determine firm entry
c. It allows financing only through nationalized banks
d. Its primary objective is protecting jobs and minimizing social unrest
37) The _____ view suggests that the success and failure of firms are largely
determined by their environments.
a. institution-based
b. stakeholder-based
c. resource-based
d. capability-based
38) Returning expatriates are referred to as _____.
a. crossovers
b. inbounds
c. repatriates
d. inpatriates
39) Which of the following cultural clusters contains the group Hindu?
a. The GLOBE clusters
b. The Huntington civilizations
c. The Ronen and Shenkar clusters
d. The Kogut-Singh cultural index
40) Which of the following statements is true about low-context cultures?
a. Communication relies a lot on the underlying unspoken context
b. Communication depends equally between the unspoken and spoken contexts
c. Communication primarily depends on body language
d. Communication is usually taken at face value
41) _____ explicitly places shareholders as the single most important stakeholder
group.
a. Shareholder securitization
b. Shareholder capitulation
c. Shareholder socialism
d. Shareholder capitalism
42) Liability of foreignness is _____.
a. the positive perception of firms and products of the host country
b. the negative perception of firms and products of the home country
c. the inherent disadvantage foreign firms experience in host countries
d. the inherent advantage foreign firms experience in home countries
43) The weight a member country carries within the IMF, which determines the amount
of its financial contribution, its capacity to borrow from the IMF, and its voting power
is referred to as a(n) _____.
a. grant
b. accommodation
c. quota
d. balance of payment
44) _____ is defined as turning over an organizational activity to an outside supplier
that will perform it on behalf of the focal firm.
a. Deregulation
b. Outsourcing
c. Commoditizing
d. Securitization
45) A strategy that would only respond to CSR causes when required by disasters and
outcries is called a(n) _____ strategy.
a. accommodative
b. proactive
c. reactive
d. defensive
46) The term for a global movement to help eradicate poverty by lending small sums
used to start small businesses is referred to as _____.
a. foreign direct investments
b. microfinance
c. venture capital investment
d. preferred financing
47) Which of the following is true of semiglobalization?
a. It is a type of globalization that adopts a strategy of treating the entire world as one
market
b. It is a type of globalization that lies between total isolation and total globalization
c. It is a form of globalization that treats each country as a unique market
d. It is a form of globalization that considers each nation in isolation when conducting
business
48) Sociologist Max Weber criticized _____ as a leading cause of Asian backwardness.
a. atheism
b. Buddhism
c. Confucianism
d. Deism
49) Ranging from entrepreneurial start-ups to multinational enterprises (MNEs), all
firms need to raise capital.
50) Inpatriation is sometimes used for filling skill shortages at headquarters.
51) Knowledge retention faces the common problem of absorptive capacity.
52) Flow of knowledge is limited in the home replication strategy.
53) Entrepreneurial opportunities exist to lower transaction costs and bring distant
groups of people, firms, and countries together.
54) Explain how the “middle-of-the-road” strategies bridge the disparity between
ethical relativism and ethical imperialism.
55) Discuss the benefits and challenges faced by the EU member countries sharing a
common currency, the euro.
56) Explain briefly the meaning of liability of foreignness. Why is it difficult for
companies to succeed in foreign markets?
57) The global product division structure organizes the MNE according to different
geographic areas.