1
The movie “How the Grinch Stole Christmas” is an example of a(n) __________ product.
(A)
standardized
(B)
adapted
(C)
global
(D)
universal
2
The European Union (EU) requires that all clothing entering into the EU should include a
care label informing consumer how to wash the garment. Lesotho, a small country in
Southern Africa, produces basic clothing products; most of the Lesotho exporters do not
include care labels in their clothing. A Lesotho clothing exporter would have to make a
_________ product adaptation if they want to export their garments to the EU.
(A)
(B)
(C)
(D)
3
Ford decides to make several product adaptations to its Fiesta model before producing it
for sale in the Indian market. One of these changes includes making shock absorbers
tougher so that they could withstand India’s potholed streets. Which of the following is a
benefit of this decision to adapt the Fiesta product line?
(A)
Lower costs of manufacturing due to economies of scale
(B)
Fast global product rollouts
(C)
Greater performance of the product due to infrastructure differences
(D)
All of the above
4
Proctor and Gamble’s Cheer laundry detergent is typically promoted in international
markets as an all-temperature detergent. But when Proctor and Gamble entered into the
Japanese market, they discovered that Japanese consumers wash their clothes in cold tap
water and they add fabric softeners to decrease the suds produced by detergents. Proctor
and Gamble reformulated Cheer to work more effectively in cold water with fabric softeners
added and changed its positioning to superior cleaning i
(A)
Products may perform better under different use conditions
(B)
Lower costs of manufacturing due to economies of scale
(C)
Fast global product roll outs
(D)
All of the above
5
Before exporting into a new country, GlobalNOW!, a Canadian consumer packaged goods
company, always consults first with the __________, a federation of national standards
organizations from 140 countries.
(A)
Global Standards Consortium
(B)
International Standards Organization
(C)
World Standards Union
(D)
Homogeneous Earth Conglomerate
6
The British standard for quality assurance (BS5750) was adopted internationally as ISO
9000 in 1987. ISO 9000 was an international standard covering a particular set of
corporate behaviors to which companies could choose to comply and consequently become
certified as to their ISO 9000 compliance. The ISO 9000 is an example of a ____________.
(A)
product adaptation
(B)
generic management system standard
(C)
modularity
(D)
consortium approach
7
Cultural adaptations are usually ___________ adaptations.
(A)
(B)
(C)
(D)
8
Within three years of entering into the U.S. market, Swedish furniture producer, IKEA, had
to make product modifications to products because_______________.
(A)
there were product size and dimension differences in the U.S.
(B)
there were different packaging and label requirements in the U.S.
(C)
the U.S. had mandatory standards that IKEA was not adhering to
(D)
None of the above
9
GlobalNOW!, a Canadian consumer packaged goods company, decides to change its sugar
packaging for the Japanese market. Their standard black and white package was changed
to a red and white package for the Japanese market. This is an example of a
______________.
(A)
modular product adaptation
(B)
product adaptation due to cultural differences
(C)
consortium approach to exporting
(D)
mandatory product adaptation
10
A French court required Yahoo! to block French users from accessing Nazi memorabilia on
its U.S.-based website. This is an example of a _________ product adaptation.
(A)
(B)
(C)
(D)
11
Some Wal-Mart employees in China were detained by the authorities for
(A)
mislabeling pork as halal
(B)
mislabeling pork as organic
(C)
refusing to accept returned products
(D)
using defective packaging
12
When Ford brought its Fiesta model into the Indian market, the product design team made
several product adaptations. Since many women wear saris, or long flowing dresses, in
India they made the doors open wider to make it easier for them to get in and out of the
car. This is an example of a ________ product adaptation.
(A)
(B)
(C)
(D)
13
The global core of a product is the
(A)
triad markets
(B)
major markets where the product is sold
(C)
markets involved in a global roll-out
(D)
percent of the product that is standardized worldwide
14
A market whose level of development exceeds that of other countries and sets a pattern for
other countries is called a __________ market.
(A)
lead
(B)
standard
(C)
must-win
(D)
home
15
A highly competent subsidiary in a market of strategic importance that is responsible for
developing a new range of products to be used by the entire company is a(n)
(A)
lead marketer
(B)
contributor
(C)
strategic leader
(D)
implementer
16
Licensing of foreign technology is a good option for companies
(A)
in a lead market
(B)
that have limited funds for R&D
(C)
in markets with high inflation rates
(D)
in markets with exchange rate fluctuations
17
Companies often acquire other companies to
(A)
gain access to new technologies
(B)
hide their losses
(C)
hide their profits
(D)
None of the above
18
To share the huge cost of developing new products, some companies have established or
joined __________ where member firms join in a working relationship without forming a
new entity.
(A)
acquisitions
(B)
mergers
(C)
joint ventures
(D)
consortiums
19
Subjecting a new creation to a series of tests in actual use conditions in order to determine
commercial feasibility is known as
(A)
test marketing
(B)
market testing
(C)
concept testing
(D)
quality assurance
20
For a new product launch in the United States, test marketing should be done in
(A)
only the United States
(B)
the United States or Canada
(C)
all major markets where the product will eventually be sold
(D)
Brazil
21
Foreign manufacturers often find themselves at a disadvantage due to local manufacturers
because ___________.
(A)
consumers have more confidence that a local supplier will accept a return or fix a product if
something goes wrong with it
(B)
consumers prefer the modular approaches commonly used by local manufacturers
(C)
consumers are aware that foreign companies are always in the introductory phase of the
product life cycle
(D)
consumers worry that foreign companies come from lead markets
22
Product life cycles for ____________ are very short. These types of products are likely to
be sold worldwide—or at least in viable markets—soon after their introduction in the
domestic market.
(A)
consumer packaged goods
(B)
services
(C)
high-tech products
(D)
home textiles
23
World Foods first introduced a new ketchup in a limited Canadian market, then it rolled it
out worldwide with minor modifications based on consumer surveys in Canada. The
Canadian advertising campaign is an example of a _________.
(A)
concept test
(B)
stratification study
(C)
test market
(D)
conjoint survey
24
Changing the color of a product to appeal to aesthetic values in different countries is an
example of a(n) ^___^ adaptation.
25
Adapting a television set to work with different voltages and electric plug designs is an
example of a(n) ^___^ adaptation.
26
The ISO coordinates the setting of global ^___^.
27
ISO 9000 is an example of a(n) ^___^ management system.
28
GM cars designed using combinations of components from different body modules and
major mechanical components are an example of a(n) ^___^ approach.
29
A highly competent subsidiary in a market of strategic importance that is responsible for
developing a new range of products to be used by the entire company is a(n) ^___^.
30
When firms buy out other firms for their new technology or products, it is known as a(n)
^___^ strategy.
31
The U.S. company, Campbell’s Soup, creates a new type of dehydrated soup. They
completes several taste tests in the U.S. market. This is an example of a ___________.
(A)
concept test
(B)
stratification study
(C)
test market
(D)
conjoint survey
32
French, British, and German aircraft producers formed Airbus, this alliance allows member
companies to effectively share technology and research and development for competitive
advantage. The new product development strategy employed by these European aircraft
producers is known as the _______ approach.
(A)
collectivist
(B)
license
(C)
concept test
(D)
consortium
33
GlobalNOW! is a small company that has only limited funds available for research and
development. GlobalNOW! should consider ____________ to acquire access to new
products.
(A)
forming a wholly owned subsidiary
(B)
entering into a distributor alliance
(C)
securing a production license
(D)
acquiring a new company
34
GM produces ________; its production process seeks to standardize as much as possible
those areas involving common components or part.
(A)
heterogeneous products
(B)
global products
(C)
international products
(D)
multi-domestic products
35
ABC International recently changed its production processes for cosmetic products; the
company has developed standard components that can easily be connected with other
standard components to increase the variety of final products. This type of product
development strategy is called __________.
(A)
modularity
(B)
saturation
(C)
consortium approach
(D)
customization
36
GM cars are designed using combinations of components from seventy different body
modules and about a hundred major mechanical components, such as engines, power
trains, and suspension systems. GM’s product development strategy is called
___________.
(A)
componentization
(B)
septuagenarianism
(C)
modularity
(D)
consortium approach
37
GlobalNOW! is changing its product development strategy. Instead of developing local
products, the company wants to produce global products. Which of the following should the
company do?
(A)
Consider the unique or special concerns of the company’s major markets first before designing
the product
(B)
Produce a product that will be identical in all of the markets where the product is sold
(C)
Develop an initial prototype product, sell it in the company’s major markets, and then use
customer survey feedback to make further localized refinements to the prototype
(D)
Produce a product for the domestic market only
38
The American company, Eli Lilly, spends the largest portion of its R&D monies at its US
research and development facilities. From this description, it is clear that Eli Lilly pursues
a(n) ______ approach to research and development.
(A)
global
(B)
traditional
(C)
untraditional
(D)
multidomestic
39
The Japanese skincare industry is developed beyond the skincare industry in most other
countries. There are several strong local and global competitors in Japan, and Japanese
consumers are some of the most sophisticated, knowledgeable, and demanding in the
global skin care market. What happens in the Japanese skincare market sets the pattern
for skincare markets around the world. Japan is a(n) ______________ market in skincare
products
(A)
emerging
(B)
hub
(C)
traditional
(D)
lead
40
Philips’ UK subsidiary developed the teletext sets, those that allow for simultaneous text
transmission for the hearing impaired during television broadcasting. The subsidiary now is
responsible for the company’s development, manufacture, and marketing of the teletext
product on a companywide basis. Philips’ UK subsidiary is playing the _________ role in
the company’s product development process.
(A)
implementer
(B)
contributor
(C)
strategic leader
(D)
hub and spoke
41
After Proctor & Gamble introduced the detergent, Vizir, in France, the company’s Spanish
subsidiary employed the same strategy the company used in the French launch in the
Spanish market. Proctor & Gamble’s Spanish subsidiary is playing the _____ role in the
company’s product development process.
(A)
implementer
(B)
contributor
(C)
strategic
(D)
hub and spoke
42
Subjecting a new product creation to a series of tests in actual use conditions in order to
determine commercial feasibility is known as ^___^ testing.
43
A modularized approach for products is widely used in which of the following industries?
(A)
Cosmetics
(B)
Automobile
(C)
Fishing
(D)
Tourism
44
Standardizing products across markets helps realize economies of scale in manufacturing.
(A)
True
(B)
False
45
The goal of a global product development team is to develop totally standardized products
for all markets.
(A)
True
(B)
False
46
The global core of a product never exceeds 50 percent.
(A)
True
(B)
False
47
Fragmentation of lead markets has led to a proliferation of product development centers.
(A)
True
(B)
False
48
The lead markets for a given industry never change.
(A)
True
(B)
False
49
Many top multinational companies stay away from lead markets due to excessive
competition.
(A)
True
(B)
False
50
Unless they are in a lead market, foreign subsidiaries do not become involved in research
and development.
(A)
True
(B)
False
51
Many Western firms have opened research and development facilities in China.
(A)
True
(B)
False
52
Licensing is beneficial for firms that have few funds for research and development.
(A)
True
(B)
False
53
The global core of a product allows firms to take advantage of economies of scale.
(A)
True
(B)
False
54
A modular approach to product design helps companies realize economies of scale in
manufacturing.
(A)
True
(B)
False
55
Global products include a portion of the final design that is standardized and retain some
flexibility to tailor the end product to the needs of individual markets.
(A)
True
(B)
False
56
Mandatory adaptations are necessary for the product to be sold in the local market.
(A)
True
(B)
False
57
Internet firms are good examples of companies that do not need to adapt products to
different cultures.
(A)
True
(B)
False
58
Firms from outside the European Union may be eligible to use the EU Certification Symbol,
CE.
(A)
True
(B)
False
59
Incompatible national standards both help and hurt global competitors.
(A)
True
(B)
False
60
ISO 9000 ensures that an organization can consistently deliver a product or service that
satisfies customers’ requirements because the company follows a state–of-the- art
environmental management system.
(A)
True
(B)
False
61
Changing the color of a product to better appeal to local tastes is a mandatory adaptation.
(A)
True
(B)
False
62
Even when other design features require no modification, product size and dimensions may
need adaptation based on local preferences and laws.
(A)
True
(B)
False
63
Differences in climatic conditions can require special adaptations in product packaging.
(A)
True
(B)
False
64
A contributor is a subsidiary that adapts some products in small but important markets.
(A)
True
(B)
False
65
In the future, foreign subsidiaries are less likely to be involved in new product
development.
(A)
True
(B)
False
66
Groups such as Canadian Standards Association formulate standards
(A)
to assure buyers of a stated level of product quality
(B)
that do not assure buyers of any quality level
(C)
to generate profits
(D)
for military equipment
67
Which of the following qualifies as a generic management system standard?
(A)
ISO 9000
(B)
ISO 14000
(C)
Both a and b
(D)
None of the above
68
ISO 14000 is a generic management system standard concerned with
(A)
quality assurance
(B)
military management
(C)
transportation management
(D)
environmental management
69
Which of the following may have to be altered as a discretionary adaptation?
(A)
Color
(B)
Scent
(C)
Sound
(D)
All of the above
70
Product sizes and dimensions are sometimes adapted based on
(A)
the sizes of houses
(B)
physical characteristics of consumers
(C)
disposable incomes
(D)
All of the above
71
Warranties for a product may vary country to country due to
(A)
local competition
(B)
the stress the product is subjected to
(C)
the technical sophistication of the market
(D)
All of the above
72
A global product is one in which
(A)
all aspects of the product are standardized
(B)
almost all aspects of the product are standardized with some (but very few) adaptations made
for local markets
(C)
a portion of the final design is standardized
(D)
the branding is standardized across markets
73
Global products are those
(A)
whose design is fully adapted for each market
(B)
whose design is fully standardized
(C)
that have a portion of their design standardized and the rest is adapted
(D)
None of the above
74
BMW had to modify its cars for the Japanese consumer to meet
(A)
higher quality requirements of Japanese consumers
(B)
lower quality requirements of Japanese consumers
(C)
higher quality requirements of the Japanese government
(D)
lower quality requirements of the Japanese government
75
Air conditioner manufacturers for the Saudi Arabian market are forced to adapt their
product due to differences in
(A)
state laws
(B)
infrastructure
(C)
climate
(D)
All of the above
76
Which is not a benefit of standardization of products?
(A)
Fast global roll-outs are possible
(B)
Consumer perceptions of a global brand may be enhanced
(C)
Product costs may be decreased by varying local inputs
(D)
Lower input costs may be achieved through volume purchasing
77
As a source for new products, Indian software companies have acquired software
companies in the United States.
(A)
True
(B)
False
78
At the concept-testing stage, products only need to be tested in the home market.
(A)
True
(B)
False
79
Concept testing is done only in domestic markets.
(A)
True
(B)
False
80
You should always test market a product in the country where it will be launched.
(A)
True
(B)
False
81
Launching a product in Belgium could serve as a test market for other European countries.
(A)
True
(B)
False
82
Most of the world operates on the metric standard.
(A)
True
(B)
False
83
The ISO 9000 standard is only appropriate for large companies.
(A)
True
(B)
False
84
Changing the design of electrical gadgets so that they work with different voltages is an
example of
(A)
discretionary adaptation
(B)
mandatory adaptation
(C)
mandatory standardization
(D)
discretionary standardization
85
Products that contain standard modules that can be easily connected with other standard
modules are said to have a(n) __________ design.
(A)
insular
(B)
modular
(C)
variable
(D)
standardized