Chapter 10 Global Strategy: Competing Around the World Answer Key
Multiple Choice Questions
1.
Because keeping cost low is critical to IKEA’s value innovation, it switched from a(n)
2.
Although demand for IKEA’s low-cost furnishings has increased, its annual store growth
has slowed to fewer than ten new stores a year. Why has this happened?
3.
As a result of globalization, the
4.
Jane is the CEO of a clothing brand, Diva Rule Inc., which has retail stores and production
units in five different countries. The firm’s shareholders ensure the proper management of
Diva Rule Inc. through their appointed board of directors. In this scenario, Diva Rule Inc. is
most likely a
5.
European aircraft maker Airbus is investing $600 million in Mobile, Alabama, to build
jetliners. Which of the following statements best explains why it is employing this
strategy?
6.
During the period of Globalization 1.0, the mode of entry into foreign markets primarily
involved
7.
Which of the following is a feature of the Globalization 2.0 stage?
8.
Which of the following is an observable feature in the Globalization 3.0 stage?
9.
A trend observed during the Globalization 3.0 stage involves
10.
How will an increase in coordinated economic and political integration between countries
affect the world economy?
11.
How has China been affected by its one-child-per-family policy and appreciation of its
currency?
12.
Emirates, Etihad Airlines, and Qatar Airways are a threat to U.S. legacy carriers because
they offer
going global.
Topic: Going Global: Why?
13.
Which of the following has been a key driver for firms to expand globally during the
Globalization 3.0 stage?
14.
India has been able to carve out a competitive advantage in business process outsourcing
(BPO) primarily because
15.
Unilever’s new-concept center is situated in downtown Shanghai, China, attracting
hundreds of eager volunteers to test the firm’s latest product innovations on-site while
Unilever researchers monitor consumer reactions. In this example, Unilever is trying to
reap the benefits of
16.
Ridemore Autos Inc. has shifted its research and development unit from its home country
to Germany. This allows the company to be better informed about the latest developments
in the automotive industry by tapping into the highly advanced automotive industry in
Germany. In this scenario, Ridemore Autos Inc. is reaping the benefits of
17.
A firm is said to be pursuing a polycentric innovation strategy when
18.
Which of the following statements accurately explains the primary reason behind
Walmart’s failure in Germany?
19.
Silca Electronics Inc. is a consumer-electronics company based in the country of Pelo. It
has approximately 300 stores across the country and is already active in three foreign
countries. It attempts to establish itself successfully in the country of Zevar, and uses its
low-cost strategy to do so. However, due to the additional costs associated with training,
coordinating across geographic distances, and other costs associated with doing business
in an unfamiliar cultural and economic environment, Silca Electronics Inc. incurs huge
financial losses in Zevar. In this scenario, Silca Electronics Inc.’s failure to establish itself
successfully in Zevar occurs most likely because
20.
Japanese and European engineering companies entered China to participate in building
the world’s largest network of high-speed trains worth billions of dollars. Companies such
as Kawasaki Heavy Industries (Japan), Siemens (Germany), and Alstom (France) were
joint-venture partners with domestic Chinese companies. These firms now allege that the
Chinese partners built on the Japanese and European partners’ advanced technology to
create their own, next-generation high-speed trains. This example best highlights the
_____ that firms can experience when expanding overseas.
21.
Which of the following is part of Geert Hofstede’s cultural dimensions?
22.
Under the CAGE distance framework, the administrative and political distance between
two countries primarily increases with
23.
United Nerumbia and Fernsland are two neighboring countries with strong economic
disparities. However, both the countries share a common national language and the same
political ideologies. The relationship between these two countries will most likely affect
the trade of
24.
When two neighboring, democratic countries that are part of a trading bloc follow different
religions and social norms, they most likely have high ______ distance.
25.
SmallWorld Inc. is a global Internet company that offers country–specific variations of its
sites, keeping in mind the linguistic and religious differences between the countries.
SmallWorld Inc. is most likely doing this to
26.
A greater cultural distance between two trading countries
27.
Zeda is a country of English-speaking people and has a very profitable economy. Which of
the following countries is most likely to be the closest to Zeda in terms of cultural
distance?
28.
How has the administrative and political distance between Canada, Mexico, and the
United States been reduced?
29.
The administrative and political distance between two trading countries reduces when
30.
For which of the following companies will geographic distance be the most relevant factor
in deciding whether or not to trade with a target country?
31.
Which of the following factors is the most important determinant of economic distance?
32.
Which of the following statements is true with regard to international trade between
countries?