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Principles of Marketing, 17e, Global Edition (Kotler/Armstrong)
Chapter 19 The Global Marketplace
1) Which of the following does NOT characterize international trade in the past 30 years?
A) The number of multinational corporations has more than doubled.
B) Over 40 percent of the largest economies in the world are corporations.
C) Trade value of products and services grew even during the recession.
D) U.S. companies have long been successful at international marketing.
E) Home markets are just as rich in opportunity as foreign markets.
2) According to the text, what location does Coca-Cola consider a promising long-term growth
opportunity?
A) Russia
B) Brazil
C) China
D) Africa
E) India
3) Which of the following is most likely to be the consequence of increased growth of global
trade?
A) Home markets become richer in opportunities.
B) Foreign firms expand aggressively into new international markets.
C) Global competition is curbed.
D) Industries become safe from foreign competition.
E) Domestic companies increase their chances to dominate their home markets.
4) Firms that decide against international expansion to play it safe ________.
A) protect themselves from competition at home
B) gain a competitive edge against imports in their home markets
C) successfully shield themselves from foreign competition
D) risk losing their home markets
E) increase their chances of entering other markets
5) Companies risk losing their home markets ________.
A) by protecting themselves from competition at home
B) to other domestic competitors
C) as they may find foreign competitors in their own backyards
D) by focusing only on their home markets
E) in hopes of growing market share at home
6) Which of the following is a risk associated with international trade?
A) technological obsolescence
B) highly unstable governments
C) market monopolization
D) lack of trade barriers
E) currency stagnation
7) Risks of global trade include all of the following EXCEPT ________.
A) high trade barriers
B) corruption
C) restrictive government policies
D) unstable currencies
E) increased opportunities for growth
8) A ________ firm is one that, by operating in more than one country, gains marketing,
production, research and development, and financial advantages that are not available to purely
domestic competitors.
A) global
B) domestic
C) federally chartered
D) direct investment
E) free trade zone
9) Since the global company sees the world as one market, it raises capital, obtains components
and materials, and manufactures and markets its goods ________.
A) at home
B) in the lowest-cost country near where each product will be sold
C) in each country in which it does business
D) in the lowest-cost country on each continent
E) wherever it can do the best job
10) Which question should most likely be answered by all companies due to the rapid move
toward globalization?
A) How should we eliminate domestic competition?
B) Should we diversify in a new business area in the home country?
C) Who will our global competitors be, and what are their strategies and resources?
D) How should we fulfill our environmental obligations?
E) Which medium of advertising should we use in our home country?
11) Before a company decides to go global, it must evaluate all of the following environments
EXCEPT the ________ environment.
A) cultural
B) natural
C) political-legal
D) global marketing
E) economic
12) Which of the following major decisions should a company make immediately after it
decides to operate internationally?
A) deciding which markets to enter
B) deciding how to enter the market
C) deciding on the global marketing organization
D) deciding on the global marketing program
E) deciding on the global communication program
13) Immediately after deciding which markets to enter, the company should determine
________.
A) the most suitable global communication program
B) how to price its products in different markets
C) the global marketing organization
D) the global marketing program
E) how to enter the market
14) Which of the following terms refers to a tax levied by a foreign government against certain
imported products to raise revenue or to protect domestic firms?
A) embargo
B) tariff
C) excise
D) exchange control
E) quota
15) Which of the following is a nontariff trade barrier?
A) strike
B) quota
C) boycott
D) exchange premium
E) restrictive product standards
16) A(n) ________ is a limit on the amount of goods that an importing country will accept in
certain product categories.
A) embargo
B) tariff
C) benchmark
D) quota
E) exchange control
17) A(n) ________ serves to limit the amount of foreign exchange and the exchange rate
against other currencies.
A) exchange premium
B) free trade zone
C) quota
D) exchange control
E) tariff trade barrier
18) Which of the following was designed to help foster trade between nations?
A) tariffs
B) GATT
C) exchange controls
D) quotas
E) nontariff trade barriers
19) Bias against bids made by American companies is an example of a(n) ________.
A) quota
B) tariff
C) boycott
D) nontariff trade barrier
E) exchange control
20) Foreign businesses in India appear to receive unusually close scrutiny and special
regulations, aimed at protecting the local businesses. This is an example of a(n) ________.
A) nontariff trade barrier
B) tariff
C) boycott
D) exchange control
E) quota
21) The ________, established in 1947 and modified in 1994, was designed to promote world
trade by reducing tariffs and other international trade barriers.
A) WTO
B) NAFTA
C) EU
D) CAFTA-DR
E) GATT
22) ________ was established to replace GATT in 1995 and now oversees the original GATT
provisions.
A) The WTO
B) The EU
C) NAFTA
D) CAFTA
E) NATO
23) Which of the following was a result of the Uruguay Round of global WTO trade talks?
A) It increased the world's remaining merchandise tariffs by 30 percent.
B) It minimized the international protection of copyrights, patents, and trademarks.
C) It extended the WTO to cover trade in agriculture and a wide range of services.
D) It established NATO for purposes of collective security.
E) It established the EU to reduce trade barriers and increase cooperation among its members.
24) Growing Green, a U.S. company that markets organic and environmentally friendly
gardening and landscaping supplies and equipment, wants to expand the business
internationally. Growing Green managers are currently examining the rules imposed by the
WTO and the agreements made by NAFTA and the EU. In which stage of the international
marketing process is Growing Green?
A) deciding on the global pricing strategies
B) deciding which markets to enter
C) deciding how to enter the market
D) deciding on the global marketing program
E) looking at the global marketing environment
25) A(n) ________ community is a group of nations organized to work toward common goals
in the regulation of international trade.
A) joint venture
B) strategic marketing
C) economic
D) joint-stock
E) multilateral
26) Economic communities are also known as ________.
A) global firms
B) free trade zones
C) management communities
D) production communities
E) open channels
27) Which of the following is an example of an economic community?
A) NATO
B) BRIC
C) CAFTA
D) GATT
E) WTO
28) Formed in 1957, ________ set out to create a single European market by reducing barriers
to the free flow of products, services, finances, and labor among member countries and
developing policies on trade with nonmember nations.
A) the Uruguay Round
B) the European Union
C) the European Organization
D) the European Central Bank
E) CAFTA
29) Which of the following is a problem caused by a policy of the EU?
A) Barriers to the free flow of products, services, finances, and labor decreased.
B) Policies on trade with nonmember nations were developed.
C) Economic powers stepped in to prop up weaker economies.
D) Adopting a common currency decreased currency risk.
E) The EU represents one of the world's largest single markets.
30) The EU helped unify Europe by adopting the euro as a common currency. Adopting a
common currency has caused problems as stronger economic countries have had to prop up all
the following European countries EXCEPT ________.
A) Cyprus
B) Portugal
C) France
D) Greece
E) United States
31) In 1994, ________ established a free trade zone among the United States, Canada, and
Mexico.
A) GATT
B) the WTO
C) NAFTA
D) the EU
E) CAFTA
32) Trusted Wholesalers is a company that purchases products produced in Mexico and sells
them to companies based in the United States and Canada. Management at Trusted Wholesalers
would most likely be interested in becoming experts in the policies developed by ________.
A) the EU
B) NAFTA
C) CAFTA-DR
D) APTA
E) the BRIC countries
33) In 2005, ________ established a free trade zone between the United States and Costa Rica,
the Dominican Republic, El Salvador, Guatemala, Honduras, and Nicaragua.
A) CAFTA-DR
B) FTAA
C) CAN
D) NAFTA
E) the EU
34) Trusted Wholesalers is a company that currently purchases products made in Mexico and
sells them to companies based in the United States and Canada. Trusted Wholesalers is
considering whether to also purchase products produced in Costa Rica and the Dominican
Republic. To make their decision, members of management at Trusted Wholesalers will most
likely evaluate the agreements made by ________.
A) the EU
B) NAFTA
C) CAFTA-DR
D) MCAN
E) UNASUR
35) Formed in 2004 and formalized in 2008, ________ makes up the largest trading block after
NAFTA and the European Union.
A) CAFTA-DR
B) FTAA
C) UNASUR
D) MCAN
E) GATT
36) The two key economic factors reflecting a country's attractiveness as a market are its
industrial structure and its ________.
A) communication adaptation
B) nontariff trade barriers
C) exchange controls
D) income distribution
E) transportation systems
37) A country's ________ shapes its product and service needs, income levels, and employment
levels.
A) international trade system
B) income distribution
C) industrial structure
D) political structure
E) foreign exchange system
38) Which of the following is a type of industrial structure?
A) marketing economies
B) subsistence economies
C) laissez-faire economies
D) capitalistic economies
E) socialistic economies
39) In a(n) ________, the vast majority of people engage in simple agriculture and consume
most of their output.
A) raw material economy
B) subsistence economy
C) industrializing economy
D) emerging economy
E) industrial economy
40) Which of the following industrial structures presents the fewest market opportunities?
A) subsistence economies
B) raw material exporting economies
C) industrializing economies
D) emerging economies
E) industrial economies
41) Which of the following is an example of a raw material exporting economy?
A) Sweden
B) Russia
C) the United Kingdom
D) Chile
E) Brazil
42) A(n) ________ economy is rich in one or more natural resources but poor in other ways
and much of its revenue comes from exporting its natural resources.
A) industrial
B) industrializing
C) raw material exporting
D) subsistence
E) agrarian
43) Coffee, tea, cotton, and tobacco are the main exports of Uganda. It is most likely that Uganda
has a(n) ________ economy.
A) subsistence
B) marketing
C) merchandise exporting
D) raw material exporting
E) industrializing
44) In a(n) ________ economy, fast growth in manufacturing results in rapid overall economic
growth.
A) industrial
B) industrializing
C) materials exporting
D) subsistence
E) agrarian
45) BRICS countries are examples of ________ economies.
A) raw material exporting
B) industrializing or emerging
C) subsistence
D) industrial
E) totalitarian
46) Which of the following characterizes emerging economies?
A) Industrialization typically creates a new rich class and a growing middle class, both
demanding new types of imported goods.
B) They trade goods among themselves and also export them to other types of economies for
raw materials and semifinished goods.
C) Most African countries fall into this category.
D) They consume most of their output and barter the rest for simple goods and services.
E) These countries are the best markets for large equipment, tools and supplies, and trucks.
47) The BRICS countries are ________.
A) Bolivia, the Republic of Haiti, Israel, and Chile
B) Britain, the Republic of the Marshall Islands, Ireland, and the Commonwealth of Australia
C) Brazil, Russia, India, China, and South Africa
D) Burundi, Rwanda, Ivory Coast, and Congo
E) Belarus, Romania, Iceland, and Czech Republic
48) Industrializing economies are also known as ________ economies.
A) emerging
B) raw material exporting
C) totalitarian
D) subsistence
E) capitalist
49) India needs more imports of raw materials such as textiles, steel, and heavy machinery and
fewer imports of finished textiles, paper products, and automobiles. In the context of industrial
structures, India is most likely a(n) ________ economy.
A) subsistence
B) totalitarian
C) raw material exporting
D) agrarian
E) industrializing
50) ________ are major importers and exporters of manufactured goods and services
A) Raw material exporting economies
B) Subsistent economies
C) Industrializing economies
D) Industrial economies
E) Emerging economies
51) Which of the following is an example of an industrial economy?
A) Japan
B) China
C) Vietnam
D) India
E) North Korea
52) Countries with ________ economies consist mostly of households with very low family
incomes.
A) industrial
B) industrializing
C) raw material exporting
D) emerging
E) subsistence
53) The United States and Norway are examples of ________ economies.
A) subsistence
B) industrializing
C) emerging
D) industrial
E) raw material exporting
54) Which of the following is an economic factor that a company should consider before
deciding to enter into a new country?
A) industrial structure
B) natural resources
C) cultural and social norms
D) political stability
E) climate
55) Income distribution is the second economic factor. While much of Africa consists of
countries with subsistence economies, companies are increasingly targeting ________
consumers in subsistence and emerging economies.
A) upper-class
B) "bottom of the economic pyramid"
C) middle-income
D) low-income
E) middle-income and low-income
56) Foreign businesses in India appear to receive unusually close scrutiny and must meet
special regulations, aimed at protecting local businesses. This includes nontariff trade barriers.
This reflects that a country's ________ should be carefully considered before doing business in
that country.
A) political-legal environment
B) industrial structure
C) cultural norms
D) natural resources
E) income distribution
57) A company should consider political and legal factors such as monetary regulations,
political stability, the country's attitudes toward international buying, and ________ when
determining whether to enter a specific country.
A) size of population
B) government bureaucracy
C) natural resources
D) income distribution
E) cultural norms
58) 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
59) Sellers might accept a(n) ________, one whose removal from the country is restricted by
the buyer's government, if they can buy other goods in that country that they need themselves
or can sell elsewhere for a needed currency.
A) blocked currency
B) countervailing duty
C) custom duty
D) anti-dumping duty
E) tariff
60) Which of the following involves the direct exchange of goods and services?
A) cash transaction
B) compensation
C) buyback
D) blocked currency
E) barter
