1) A firm’s vertical differentiation determines where in its organization structure
managers have decided to concentrate decision-making authority.
2) A company that exports products at a price lower than its domestic market price is
using a skimming policy abroad.
3) The Chicago Mercantile Exchange and NASDAQ are part of the OTC market.
4) When firms estimate the costs of outsourcing to low-wage countries, they often
overlook elements such as shipping distances.
5) At present there is little reciprocal recognition of professional licensing among
countries.
6) In a brief essay, describe the political and legal systems in China and their effect on
MNEs doing business in China.
7) A major criticism of offshoring is that it ________
A) increases production costs
B) exchanges good jobs for bad jobs
C) threatens the sovereignty of larger countries
D) allows companies to avoid payment of any taxes
8) This spring break you are planning to leave the U.S. and visit London, where you
will stay in a hotel for 10 days. The London hotel will be performing a(n) ________.
A) indirect merchandise export
B) merchandise export
C) service export
D) service import
9) Which of the following is a voluntary effort by 150 multinational construction and
natural-resources companies to end bribery?
A) Foreign Corrupt Practices Act
B) Partnering Against Corruption Initiative
C) OLAF (European Commission Anti-Fraud Office)
D) Sarbanes-Oxley Act
10) The HRM requirements of a(n) ________ strategy are well matched with an
ethnocentric staffing policy.
A) multidomestic
B) transnational
C) international
D) global
11) The Economic Freedom Index indicates that economic freedom is positively
correlated with all of the following EXCEPT ________.
A) life expectancy
B) literacy
C) environmental sustainability
D) diversity
12) Germany’s accounting system has historically been a ________ system.
A) micro-pragmatic
B) macro-pragmatic
C) law-based
D) tax-based
13) Metro Hotels, a U.S. hotel chain, has transferred several of its employees to
Myanmar where they will work for three or four years before returning to the U.S. The
employees will be working with a Myanmar hotel to provide it with their extensive
knowledge regarding how to run a hotel. Metro is most likely involved in a ________.
A) franchise
B) turnkey operation
C) joint venture
D) management contract
14) Which of the following statements is most likely true about the postconventional
level of moral development?
A) Individuals learn what is moral but not why such behavior is moral
B) Individuals behave morally because they fear negative repercussions
C) Individuals learn how to conform to society’s values through observation
D) Individuals behave morally because they believe such actions are right
15) The U.S. dollar is most likely traded widely because it is ________.
A) a reserve currency held by many central banks
B) one of the oldest and most stable currencies in the world
C) monitored by the Bank of International Settlements and the U.S. Federal Reserve
D) based on prices of the NYSE, which is the world’s largest foreign-exchange center
16) Which of the following countries is an important offshore financial center?
A) Turks and Caicos
B) Mexico
C) South Korea
D) Bermuda
17) The Fed wants to counter downward pressure on the dollar, so it will most likely
________.
A) sell dollars for foreign currency
B) sell dollars and buy foreign stocks
C) buy Treasury bills with dollars
D) buy dollars with foreign currency
18) ________ is the linking or integrating of activities into a unified system.
A) Control
B) Coordination
C) Configuration
D) Compatibility
19) Critics of offshoring claim all EXCEPT which of the following?
A) Cost savings are seldom passed on to final consumers
B) Offshoring reduces the incomes of people in low-wage countries
C) Incomes of workers in countries whose companies offshored production have gone
down as a percentage of national income
D) Many workers who have been displaced by offshoring do not have the skills needed
for higher-value jobs
20) Which of the following is conducive to low transfer prices from the parent company
to a foreign subsidiary and high transfer prices to the parent company from a foreign
subsidiary?
A) political instability
B) restrictions on profit or dividend remittances
C) restrictions in the subsidiary country on the value of imported products
D) desire to mask the profitability of the foreign subsidiary to keep competitors out
21) Why is management of international human resources more difficult than directing
human resources at the domestic level?
A) the complications that arise from political, cultural, legal, and economic differences
between countries
B) the challenge posed by managers in other countries that aim to achieve global
objectives for the company no matter the costs imposed on national objectives
C) the greater similarity among foreign subsidiaries than among domestic subsidiaries
in terms of dependence on headquarters for resources
D) the complications posed by dealing with competing agendas from different labor
unions in different countries
22) Market economies are primarily characterized by ________.
A) formal cooperation among government, companies, and workers to achieve stable
growth
B) heavy government spending and high taxation to pay for a range of social services
C) minimal governmental participation
D) restricted consumer powers
23) What are the current trends in expatriate allowances? What are the reasons for these
changes?
24) What are the two major segments of the foreign-exchange market? What types of
foreign-exchange instruments are traded within these markets?
25) How is foreign exchange traded? What methods are available?
26) What role does the customs agency of a government play?
27) How has technology altered supply chain management? Discuss some of the
available tools.