1) What determines the success or failure of businesses in foreign market entries?
a. Overwhelming resources and capabilities to offset the liability of foreignness
b. Understanding the rules of the game governing competition in foreign countries
c. Matching efforts in market entry and geographic diversification with strategic goals
d. All of these answers
2) Although American movies dominate the world market, ____ limit the market share
of American movies to protect their domestic movies.
a. Canada c. South Korea
b. France d. All of these answers
3) NTBs include:
a. Subsidies, import quotas
b. Export restraints, local content requirements
c. Administrative policies, antidumping duties
d. All of these answers
4) What is the best strategy for finding success with mergers and alliances, using an
institution-based view?
a. Managers need to understand the rules of the game, including both legal regulation
and the market environment
b. Managers need to pay attention to firms’ relational capabilities that often make or
break relationships
c. Managers need to maintain a strong organizational structure
d. Managers should see the target in terms of value and not pay too high a premium
5) The key differentiator between rapidly and slowly internationalizing SMEs is:
a. The amount and speed of foreign direct investment
b. The international experience of entrepreneurs
c. The ability to apply new technology
d. Formal institutions and government regulation
6) Which of the following best describes a rate in which selective government
intervention works hand-in-hand with allowing markets the freedom to work
themselves out?
a. Floating rate c. Dirty float rate
b. Fixed rate d. Target exchange rate
7) What is the main reason why formal institutions limit alliances and acquisitions in
the areas of formal market entry modes?
a. Many governments discourage acquisitions in order to establish local-only
subsidiaries
b. The liability of foreignness is guaranteed to make the alliances or acquisitions fail
c. The governments are unable to tax acquisitions by foreign firms
d. The institutions do not limit the firms in regards to entry modes
8) Unlike his industry peers, Duke Energy CEO Jim Rogers has been bitten by the
climate bug and has voluntarily worked to reduce greenhouse gas emissions. This
exemplifies a ____ strategy.
a. Reactive c. Accommodative
b. Defensive d. Proactive
9) Which of the following is a drawback of an alliance?
a. Getting stuck with the wrong partner
b. Potential for partner opportunism
c. Partners engaging in learning race
d. All of these answers
10) MNE strategies are:
a. home replication
b. localization and global standardization
c. transnational
d. home replication, localization, global standardization, and transnational
11) What is the main reason the US, Canada, and Australia decided to join the
Asia-Pacific Economic Cooperation (APEC)?
a. No one wants to be left out of the most dynamic region in the world
b. The APEC members desire closer economic integration
c. Common political/economic interests
d. All of these answers
12) How many individuals are employed by foreign-owned firms throughout the world?
a. About 80 million c. About 18 million
b. About 40 million d. About 1 million
13) Many Western managers are unwilling to accept a local plus package instead of the
traditional expatriate package full of perks.
14) The WTO has six main areas of concern, including trade of goods, services,
intellectual property, and banning governments from protecting their agricultural
industry.
15) Equity alliance relationships tend to have less direct control over joint activities on
a continual basis than the contractual relationships.
16) Factor endowments; domestic demand; firm strategy, structure, and rivalry; and
related and supporting industries are aspects of strategic trade theory.
17) Describe several problems associated with repatriation.
18) Identify the concept behind the Big Mac index and provide an example why this
index should be used with caution.
19) The “invisible hand” of market forces noted by Adam Smith in the Wealth of
Nations in 1776 characterizes a pure market economy.
20) Explain the prediction made by Theodore Levitt, and determine whether or not it
was accurate.