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61) Which of the following is a political and legal factor that a company should consider before
deciding to enter into a new country?
A) monetary and trade regulations
B) transportation structure
C) population size and growth
D) industrial infrastructure
E) business norms and approaches
62) Which of the following is an economic factor that a company should consider before
deciding to enter into a new country?
A) population size and growth
B) natural resources
C) cultural and social norms
D) political stability
E) climate
63) Members of management at Growing Green, a company that markets organic and
environmentally friendly gardening and landscaping supplies and equipment, are evaluating the
benefits and disadvantages of indirect exporting, direct exporting, and licensing. In which stage
of the international marketing process is Growing Green?
A) deciding on the global advertising strategy
B) deciding which markets to enter
C) deciding how to enter the market
D) deciding on the global marketing program
E) deciding on the global marketing organization
64) The simplest way to enter a foreign market is through ________.
A) joint venturing
B) direct investment
C) exporting
D) joint ownership
E) contract manufacturing
65) When entering a foreign market, companies typically start with ________, working through
independent intermediaries to sell products produced in the home country.
A) direct exporting
B) embargo
C) product adaptation
D) indirect exporting
E) licensing
66) Which of the following characterizes indirect exporting?
A) It requires more investment than joint venturing.
B) It requires an overseas marketing organization or network.
C) It involves less risk and investment than other entry methods.
D) The potential returns are greater than direct exporting.
E) It involves joining with foreign companies to produce or market products or services.
67) In the case of ________ exporting, sellers handle their own exports.
A) direct
B) licensed
C) indirect
D) countervailing
E) multilateral
68) Think Ink is a growing company that sells a variety of inks for home and business printers.
Management at Think Ink has decided to open a sales branch overseas to handle sales and
distribution abroad. Think Ink is engaging in ________.
A) indirect exporting
B) direct exporting
C) licensing
D) joint ownership
E) management contracting
69) Which of the following is a type of joint venturing?
A) trade embargo
B) licensing
C) direct investment
D) direct exporting
E) indirect exporting
70) Through ________, an organization in the foreign market buys the right to use a company's
manufacturing process, trademark, patent, trade secret, or other item of value.
A) indirect exporting
B) licensing
C) contract manufacturing
D) management contracting
E) joint ownership
71) In Japan, Budweiser beer flows from Kirin breweries, and Moringa Milk Company produces
Sunkist fruit juice. These are examples of ________.
A) contract manufacturing
B) management contracting
C) licensing
D) joint venturing
E) directly investment
72) Sears opened up department stores in Mexico and Spain, where it found qualified local
manufacturers to produce many of the products it sells. This type of joint venture is known as
________.
A) joint ownership
B) licensing
C) management contracting
D) indirect exporting
E) contract manufacturing
73) Which of the following is true of contract manufacturing?
A) It provides a chance to start faster but with more risks.
B) It involves decreased control over the manufacturing process.
C) It leads to an increase in potential profits on manufacturing.
D) It is the simplest way to enter a foreign market.
E) It involves entering a foreign market by exporting the surplus products.
74) Hilton helps others run their hotels by providing the management know-how. This type of
joint venture is known as ________.
A) contract manufacturing
B) licensing
C) management contracting
D) joint ownership
E) direct investment
75) Campbell Soup recently joined forces with Hong Kong-based Swire Pacific to form an entity
called Campbell Swire—to better distribute the company's soups in China. This is an example of
________.
A) licensing
B) contract manufacturing
C) management contracting
D) joint ownership
E) indirect exporting
76) ________ ventures consist of one company joining forces with foreign investors to create a
local business in which they share ownership and control.
A) Joint ownership
B) Licensing
C) Contract manufacturing
D) Management contracting
E) Indirect exporting
77) ________ involves entering a foreign market by developing foreign-based assembly or
manufacturing facilities.
A) Indirect exporting
B) Direct investment
C) Joint venturing
D) Contract manufacturing
E) Direct exporting
78) Lower costs in the form of cheaper labor or raw materials, foreign government investment
incentives, freight savings, and the opportunity to improve the company image are the factors
that would most likely lead a company to enter a foreign market using the market entry strategy
of ________.
A) direct exporting
B) licensing
C) management contracting
D) indirect exporting
E) direct investment
79) ________ involves essentially using the same marketing strategy approaches and marketing
mix worldwide
A) Adapted global marketing
B) Ambush marketing
C) Standardized global marketing
D) Export marketing
E) Niche marketing
80) ________ means adjusting the marketing strategy and mix elements to each international
target market.
A) Standardized global marketing
B) Ambush marketing
C) Adapted global marketing
D) Mass marketing
E) Whole channel viewing
81) ________ means marketing a product in a foreign market without making any changes to the
product.
A) Product adaptation
B) Product invention
C) Communication adaptation
D) Straight product extension
E) Product augmentation
82) Heineken beer is sold successfully in the same form around the world. Which of the
following product strategies is illustrated in this example?
A) product adaptation
B) straight product extension
C) product invention
D) product augmentation
E) communication adaptation
83) Kraft has adapted its popular Oreo cookie to the unique tastes of consumers all around the
world, whether it's mango-and-orange flavored Oreos in the Asia Pacific region, green tea Oreos
in China, a chocolate and peanut variety in Indonesia, or banana and dulce de leche in
Argentina.. This is an example of ________.
A) product invention
B) straight product extension
C) product adaptation
D) product augmentation
E) communication adaptation
84) ________ involves changing the product to meet local requirements, conditions, or wants.
A) Product invention
B) Straight product extension
C) Standard global marketing
D) Communication adaptation
E) Product adaptation
85) Vidal Sassoon shampoos contain different amounts of scent according to the country in
which they are sold. This is an example of ________.
A) straight product extension
B) product invention
C) product adaptation
D) communication adaptation
E) standardized global marketing
86) ________ consists of creating something new to meet the needs of consumers in a given
country.
A) Communication adaptation
B) Joint venturing
C) Product invention
D) Straight product extension
E) Product adaptation
87) GigaTalk, a U.S. based computer manufacturing company, found that Japanese commuters
had difficulty using standard laptops on crowded rush-hour trains because while standing,
commuters cannot use their laptops. So GigaTalk created a standing computer. This computer
includes a touch screen and small keyboard that can be used while standing or on the move. This
is an example of ________.
A) straight product extension
B) product invention
C) product adaptation
D) dual adaptation
E) communication adaptation
88) Changing promotions to suit local markets is known as ________.
A) straight product extension
B) ambush marketing
C) communication adaptation
D) product adaptation
E) standardized global marketing
89) Kellogg ads in the United States promote the taste and nutrition of Kellogg's cereals versus
competitors' brands. In France, where consumers drink little milk and eat little for breakfast,
Kellogg's ads must convince consumers that cereals are a tasty and healthful breakfast. Which
marketing strategy is being followed by Kellogg?
A) straight product extension
B) product adaptation
C) product invention
D) communication adaptation
E) straight communication extension
90) In Chinese, the KFC slogan "finger-lickin'' good" came out as "eat your fingers off." And
Motorola's Hello-moto ringtone sounded like "Hello, Fatty" in India. Which of the following
strategies can be used to avoid such mistakes?
A) communication adaptation
B) standardized global marketing
C) straight product extension
D) product adaptation
E) communication extension
91) Assume that a Gucci handbag sells for $60 in Italy and $240 in the United States because
Gucci must add the cost of transportation, tariffs, importer margin, wholesaler margin, and
retailer margin to its factory price. This information indicates that Gucci faces a ________
problem.
A) dumping
B) tariff
C) licensing
D) product adaptation
E) price escalation
92) The two major links between the seller and the final buyer-channels between nations and
channels within nations—make up a ________.
A) whole-channel view
B) direct-distribution channel
C) large-scale channel
D) transportation network
E) retail channel
93) ________ are the first link between the seller and the final buyer and they move company
products from points of production to the borders of countries within which they are sold.
A) Channels between nations
B) Channels within nations
C) Retail channels
D) Large-scale channels
E) Value chain channels
94) A firm normally gets into international marketing by simply shipping out its goods. If its
international sales expand, the company organizes a(n) ________.
A) indirect exporting venture
B) joint ownership
C) export department
D) international division
E) standardized global marketing strategy
95) World product groups, geographical organizations, and international subsidiaries are all
options for organizing a(n)________.
A) export department
B) indirect exporting venture
C) joint ownership
D) international division
E) standardized global marketing strategy
96) In a(n) ________, executives are trained in worldwide operations, not just domestic or
international operations.
A) direct exporting company
B) joint venture
C) international division
D) international subsidiary
E) global organization
97) At Comfort Homes, a manufacturer of furniture and home accessories, the global operating
units report directly to the chief executive instead of a head of an international division. The
company recruits management from many countries and buys components and supplies where
they cost the least. Comfort Homes is most accurately classified as a(n) ________.
A) direct exporter
B) geographical organization
C) international subsidiary
D) global organization
E) world product group
Refer to the scenario below to answer the following questions.
Selman & Saks, a maker of men's and women's razors and electric hair trimmers, had little
reason to become involved in the global arena. But after acquiring Wellman Enterprises, whose
largest division engages in a licensing agreement with a German firm to produce women's
hosiery, managers at Selman & Saks wondered whether a company-wide global focus would be
more profitable after all.
Managers at Selman & Saks studied Wellman's licensing agreement in great detail. Even after
seeing the benefits Wellman achieved with the licensing agreement, managers decided that
Selman & Saks would target the French market merely via exporting.
With the assistance of a domestic export department, Selman & Saks razors and hair trimmers
entered France. For six months, sales were mediocre. But after that, sales suffered. Opinions
varied among numerous managers as to the cause of the failure. "Who knows the local market
better than people who live there?" was a comment heard throughout Selman & Saks. "Maybe
we needed an alliance with a French firm, or a licensing agreement, before racing to get there."
98) What did Selman & Saks hope to gain by entering the French market?
A) access to new consumer markets
B) access to less expensive labor
C) access to less expensive materials
D) access to foreign investment incentives
E) the ability to offset domestic economic cycles
99) If Selman & Saks allowed a French company to produce and market razors and trimmers
carrying the company's brand in exchange for a royalty, Selman & Saks would be using the
market entry strategy of ________.
A) exporting
B) franchising
C) licensing
D) contract manufacturing
E) joint ownership
100) Foreign firms are expanding aggressively into new international markets, and home markets
are no longer as rich in opportunity.
101) Tariffs are limits on the amount of foreign imports that a country will accept in certain
product categories.
102) Nontariff trade barriers include restrictive product standards.
