The export marketing plan is essentially the same as the domestic marketing plan.
Geographical proximity is rarely a major reason for trade.
The GLED model suggests that there are some individual characteristics that are
antecedent to the development process.
Dunning’s eclectic theory of international production provides an explanation for the
choice by the international firm of its overseas production facilities.
Social loafing is not an issue on virtual teams.
Japanese cultural values suggest that in Japan, antitrust law against cartels would be
strictly enforced.
The sales agreement should not address where disputes will be resolved and by what
legal system. That belongs in a side document.
Policy continuity and government stability are more important to a business than the
type of political system.
Corporate anthropology refers to the process of obtaining market research data through
focus groups and surveys.
Monetary policies control the collecting and spending of money by governments.
Industrialized nations invest primarily in one another just as they trade more with one
another.
Subsidiary management morale is one element in determining where decisions would
be made.
One possible current currency arrangement is a fixed peg, whereby the exchange rate of
a currency is allowed to move (within a narrow band) with another currency. One
example is the pegging of the Canadian dollar to the U.S. dollar.
One reason for using home-country citizens overseas is to prepare them for high-level
positions at headquarters.
A matrix organization involves two or more dimensions, such as area and product, in
which managers are at the same level but do not have overlapping responsibilities.
A benefit of global strategies is their ability to adjust quickly and effectively to changes
in customer needs across national or regional markets.
The international Fisher effect states that the interest rate differentials for any two
currencies reflect the expected change in their exchange rates.
Companies pursuing a home replication strategy typically centralize product
development functions in their home country and then transfer innovations to foreign
markets in order to capture additional value.
An examination of the 2009 Human Development Report shows that only 23 of the 182
countries for which data were available had average annual GDP per capita growth rates
that were higher than the U.S. growth rate for the period 1990-2007.
That free trade is the best strategy for advancing the world’s economic development is
one of the few propositions on which almost all economists agree.
ASEAN, whose initial goal was political, to foster peaceful relations among members,
includes China as its core member.
Microsoft is an example of how a company can avoid multiple antitrust laws in multiple
jurisdictions, thanks to equalization agreements.
According to the text, the self-absorption criterion is probably the biggest cause of
international business blunders.
Imports to a country can be a good indicator of the potential demand for a new product.
Export drafts must be paid before the buyer receives shipping documents.
Trend analysis and cluster analysis are used in the third screening phase.
U.S. ocean shipping companies are benefiting from U.S. government subsidies.
The international division is a division in the organization that is responsible for all
non-home-country activities and reports to the domestic division.
To avoid changing the product to meet local legal requirements, manufacturers
frequently design it to meet the most stringent laws, even though it is over designed for
other markets.
The great disparity in income throughout the world promotes worldwide product
standardization.
International trade includes exports, imports, and foreign direct investment.
Payment terms are incidental once the customer need has been identified and a sales
price agreed to.
Logistics refers to managerial functions associated with the movement of raw materials
and work in progress, but not finished goods.
According to Frederick W. Gluck, formal strategic planning teams must assume a more
explicit strategic decision-making role in strategic planning, including dedicating a
large amount of time to deciding how things ought to be instead of listening to analyses
of how they are.
The Ottoman Empire’s powerful location raised the cost of Asian trade for the
Europeans and resulted in a search for sea routes to Asia.
Incoterms attempt to standardize shipping agreements, and they include:
A. FAS and CIF.
B. CED and COD.
C. descriptions of portside processes.
D. insurance arrangements for international shipments.
E. performance guarantees.
Under new institutional theory, institutions can be categorized as formal and informal,
and the informal institutions can be further categorized as:
A. normative and cognitive.
B. normal and abnormal.
C. informally cognitive and formally cognitive.
D. effective and ineffective.
Porter’s Diamond Model of national advantage:
A. claims that the ability of local firms in a country to utilize the country’s resources to
gain a competitive advantage is based on demand conditions, factor conditions,
substitute products, and firm strategy, structure, and rivalry.
B. links intraindustry trade to relative levels of per capita income.
C. is not affected by chance.
D. all of A, B, and C.
E. two of A, B, and C.
Companies controlled by other companies through ownership of enough voting stock to
elect board-of-director majorities are known as:
A. affiliates.
B. joint ventures.
C. subsidiaries.
D. strategic alliances.
E. two of the above.
Organizational design:
A. is a process that deals with how an international business should be organized in
order to ensure that its business activities are integrated globally.
B. must consider the size of an organization and the complexity of its business
operations.
C. must be able to evolve over time in order to enable the organization to respond to
change.
D. all of the above
E. two of A, B, and C.
The end result of legal trade obstacles is often:
A. limited trade, with the recipient of the obstacles withdrawing.
B. political negotiations between the two countries, to smooth relations and reduce
costs.
C. higher costs to consumers.
D. lower taxes to citizens due to tariff revenues.
E. none of the above.
Most top managers:
A. prefer nonquantifiable, directional goals.
B. prefer nonquantifiable but verifiable goals.
C. prefer verifiable objectives.
D. have no preference as to quantifiable and nonquantifiable goals.
E. none of the above.
The new directions in planning:
A. two of B, C, D, and E.
B. have made strategic planners dominant in the planning process.
C. have brought operating managers into the planning process.
D. have relieved the firm’s chief executive officer of the responsibility for strategic
planning.
E. have made the use of computers and professional planners essential for the planning
process.
Cultural dumping is found in:
A. Japan’s past refusal to import American skis because Japanese snow is different, so
the skis should meet different standards.
B. Saudi Arabia’s refusal to import Playboy magazine.
C. The small town of Orleans, Massachusetts, decision to prohibit franchised stores
from operating in the town.
D. two of the above.
E. all of A, B, and C.
Production managers have discovered that their introduction of new production
methods across cultures is affected by varying attitudes toward:
A. their personalities.
B. developed economies.
C. change.
D. technology.
The attractions of using the Internet as an international advertising medium include:
A. a high number of users of the Internet read English or other common languages well.
B. Internet communications are two-way, rather than one-way like newspaper ads.
C. it is possible to tailor messages to the customer, based on answers to prior questions.
D. all of the above.
E. two of A, B, and C.
A strategic plan:
A. will be prepared when the tactical plan is finalized.
B. describes how the firm’s goals will be met.
C. contains sales forecasts and budgets.
D. all of the above.
E. two of A, B, and C.
According to opponents of the globalization of trade and investment:
A. globalization has produced uneven results across nations and people.
B. globalization has had harmful effects on labor and labor standards.
C. globalization has contributed to a decline in environmental and health conditions.
D. all of the above.
E. two of A, B and C.
A way to measure a company’s success in sustainable business practices is:
A. to examine the return on investment.
B. triple-bottom-line accounting.
C. to monitor the company in a social context.
D. to review the marketing materials.
In U.S. industry, the proportion of purchased materials in the overall cost of goods sold
has been rising for several decades, to a level of ________ percent today.
A. 40
B. 45 to 60
C. 55 to 79
D. 65 to 74
E. over 80
Maznevski’s map-bridge-integrate model helps global team members:
A. more fully understand each other and establish how the team will work.
B. avoid dealing with cultural differences.
C. establish ways to address planning issues.
D. focus more fully on the task.
E. B and D.
According to the text, manufacturers of ____________ rely more on personal selling
than on advertising to communicate with their overseas markets.
A. industrial products
B. consumer products, especially in developed countries
C. consumer products, especially in developing countries
D. all of the above.
E. two of A, B, and C.
“Trade without discrimination” in the WTO means that
A. the MFN principle can be ignored.
B. all trading partners must be treated the same.
C. racially based trading patterns are tolerated.
D. developing and developed nations must be separated for trading purposes.
Size of the urban population and electricity consumption are part of the __________
index.
A. market size
B. market growth rate
C. e-commerce readiness
D. market factor
E. none of the above
There are two points at which operating in a foreign currency raises issues for
accounting:
A. when debt is incurred and when foreign payrolls are run.
B. when transactions are made in foreign currencies and when foreign subsidiaries
consolidate their results back to corporate financial reports.
C. when the currency fluctuates and when the local inflation rate changes.
D. when the interest and inflation rates change.
Entry barriers are part of the ___________ stage of market screening.
A. economic and financial
B. political and legal
C. sociocultural
D. market entry
E. none of the above
Market size, market growth rate, and e-commerce indexes are all part of:
A. market factors.
B. trend analysis.
C. cluster analysis.
D. market indicators.
E. none of the above.
Instead of declining, this nonrenewable energy source, because of its lack of pollution
and the rising price of oil, has seen significant growth:
A. wind power.
B. nuclear power.
C. geothermal power.
D. petroleum.
The market growth rate index is measured by:
A. none of B, C, D, or E.
B. average growth rate in commercial energy + real growth rate in GDP.
C. real growth rate in commercial energy + real growth rate in GDP.
D. average growth rate in commercial energy + average growth rate in GDP.
E. real growth rate in commercial energy + average growth rate in GDP.
The Fisher effect states that the real interest rate:
A. is the nominal rate plus the recorded inflation rate.
B. is the only measure to use in calculating PPP.
C. is the nominal rate minus the expected inflation rate.
D. is the difference between the nominal rate and the inflation rate.
The U.S. government’s attitude toward transfer pricing on subsidiary transactions in
foreign locations is:
A. uninterested, because these transactions are outside the United States and, thus,
beyond U.S. jurisdiction.
B. interested, because transfer pricing has tax implications for the host governments—
hence the IRS guidelines.
C. neither interested nor uninterested, because, although there are tax implications for
the host country, the U.S. tax authorities feel comfortable exercising their authority
globally.
D. uninterested, because foreign taxes are of no interest to them.
The concept of strict liability, as found in the U.S. legal system, applies:
A. to harm done by the designer/manufacturer without the need to prove negligence.
B. to harm done within narrow limits, considering the design of the product.
C. to children harmed by products in both the United States and the EU.
D. strictly to harm caused by the designer/manufacturer, so no penalties outside of
damages can be awarded.
E. none of the above.
Companies in the United States, Canada, and the United Kingdom tend to:
A. rely on equity more than do companies in most other countries.
B. depend on debt more than do companies in other countries.
C. divide their equity and debt almost evenly.
D. rely on retained earnings more than do companies in most other countries.
In his book Cannibals with Forks, John Elkington puts forward the argument that:
A. capitalism can become civilized.
B. capitalism is not, by its very nature, uncivilized and destructive of natural resources.
C. natural resources are a God-given gift for mankind to use.
D. developing nations will become more competitive with Western nations.