Country and region are units of analysis for market screening.
Trading blocs always bring cost savings to international firms.
Subsidiary detriment occurs when a small loss for a subsidiary results in a greater gain
for the total IC.
Some of the reasons for the global standardization of a firm’s manufacturing system are
the effects on organization and staffing.
Permanent members of the UN Security Council vote on Security Council measures,
and only the secretary-general of the UN, Ban Ki-Moon, has veto power.
Production methods between capital-and labor-intensive methods are classified as
intermediate technology.
One variable commonly used to measure where and how fast internationalization takes
place is the increase in total foreign direct investment.
According to the text, Zara’s strategy of speed and flexibility has enabled the company
to eliminate inventory.
China participates in the management of the international financial environment by
managing its currency.
The balance of payments is a record of a country’s transactions with its major trading
partners.
The United States and Canada are small power distance countries because they expect a
level playing field, socially, at least at the ideal level.
Duties may be used to encourage local input.
Many smaller and developing nations want to reduce patent protection from the current
15 to 20 years down to 5 years or even 30 months.
In human resources, laws administered by the Equal Employment Opportunity
Commission, (EEOC) allow an American company to be successful on the cultural
front in all foreign labor markets.
During the second screening, analysts are highly concerned with inflation rates,
education levels, and entry barriers.
Some nations, especially in Asia, follow the Carlos Calvo doctrine, which protects them
against fraud.
One of the most common mistakes made by new exporters is not getting advice.
The local manufacturing organization is usually integrated vertically to a greater extent
than the parent company is.
Trade flows are good indicators of the magnitude of present sales.
Cultural attitudes toward change can influence the acceptance of new production
methods.
According to the text, differences in taste, a demand variable, can reverse the direction
of trade predicted by the theory.
Some of the culture dimensions that are involved in change are tolerance of ambiguity
and power distance.
The U.S. enforcement of Equal Employment Opportunity Commission (EEOC) law in
U.S. companies operating abroad is an example of extraterritoriality.
Pooling alliances are driven by the logic of contributing dissimilar resources, while
trading alliances are driven by similarity and integration.
Tariffs are categorized as financial and political forces, but they are usually not seen as
legal forces.
Free trade zones are areas designated by the government of a country for duty-free
entry of any nonprohibited good.
An expatriate is a person living outside his or her country of birth.
Scenario planning helps to emphasize that the business environment is predictable and
helps to emphasize the application of traditional perspectives when solving problems.
The physical product includes the total product, brand name, accessories, after-sales
service, warranty and instructions for use, company image, and package.
A business whose activities are carried out across national borders is known as an
international business.
A global strategy tends to be used when a company faces strong pressures for reducing
costs and limited pressure to adapt products for local markets.
Coaching is not important in a diverse team if the norms are strong.
The IBRD is a major institution of the World Bank whose function is to loan to:
A. countries whose income levels make them not creditworthy.
B. private-sector development-focused firms.
C. private individuals in developing nations whose entrepreneurial efforts support
development.
D. middle-income and creditworthy poor nations.
Lack of folklore knowledge is illustrated by:
A. Smirnoff’s use of a Che Guevara image in Cuba, because Che is a national hero
there.
B. Apple’s use of an image of the Dalai Lama, because it offended China, where the
government sees the Dalai Lama as a political dissident.
C. the U.S. NFL playing U.S. football in the UK.
D. A and B
A value-added tax is actually a sales tax that is:
A. paid by the firm rather than the consumer.
B. paid in stages along the process from raw materials to consumer and then credited
after final sale.
C. called value added to create a positive spin on taxation.
D. voluntarily paid on exports.
“Women are inappropriate for global leadership positions.” This statement is:
A. true, because of cultural differences.
B. true, because of experience gaps.
C. false, because women have characteristics aligned with global leadership traits.
D. false, because women understand oppression and victimization.
E. true, because if women could do the job, they would be doing it.
Material culture includes:
A. what people in the culture make, such as tools, art, and everything material.
B. tapestries but not their frames and the wool or other fabric before it is woven.
C. only manufactures of which the culture is proud.
D. only pottery, glassware and eating utensils.
A nation having absolute disadvantages in the production of two goods with respect to
another nation has ___________ in the production of the good in which its absolute
disadvantage is less.
A. a comparative advantage
B. an absolute advantage
C. a mercantilist advantage
D. none of the above
E. two of A, B, and C
Global leadership can be regarded as different in kind from domestic leadership
because:
A. it requires much more knowledge of foreign languages and geography.
B. the differences between them are inconsequential.
C. their differences are of such great degrees with regard to their level of skills and
application.
D. the domestic context does not require travel or knowledge of geography.
E. the domestic context is so limited.
Among the external businesses that conduct country risk assessment are:
A. the Economist Intelligence Unit, Euromoney, the Harvard Business Review
B. Moody’s, Standard and Poor’s, STRATFOR
C. The New York Times, Wilson Quarterly, Forum
D. two of the above.
E. all of A, B, and C.
A specific example of a sustainable business is Patagonia, as evidenced in its:
A. Footprint Chronicles program that addresses the trade-offs global sourcing creates
and evaluates the impact of sourcing decisions.
B. ecosystem model of sustainability that relies on the synergies between financial,
environmental, and social elements.
C. product lines and credit policies.
D. A and B.
Which of the following is explained by international trade theory?
A. Differences in production costs
B. Differences in levels of technology
C. Foreign exchange rates
D. Differences in efficiency of factor use
E. All of the above
Market Access and Compliance (MAC) specialists seek to open foreign markets to
American products. MAC specialists do not do the following:
A. develop strategies to overcome obstacles faced by U.S. business in foreign countries
and regions.
B. monitor foreign country compliance with trade agreements.
C. monitor exchange rate movement.
D. all of the above.
E. A and B.
E. T. Hall suggests that to learn another culture, you have to undergo extensive training
or spend:
A. a lifetime in the other culture.
B. considerable time with people of the other culture, but perhaps outside that culture.
C. time studying the language of the other culture.
D. considerable amounts of time and money taking guided tours in the other culture.
According to the text, which of the following is true regarding “corporate
anthropology”?
A. It involves ethnographic research techniques.
B. It involves extensive use of surveys.
C. It involves extensive use of focus groups.
D. All of the above.
E. A and C.
Firms have developed international finance centers in order to:
A. centralize the financial management function and thereby reduce costs and increase
both profits and efficiencies.
B. meet WTO guidelines.
C. compete with international banks.
D. facilitate interfirm and intrafirm transfer pricing.
According to the text, approximately ______ of expatriates leave their firms during the
course of their overseas assignment.
A. 10 percent
B. 25 percent
C. 31 percent
D. nearly 40 percent
E. none of the above
A standardized global leadership development approach:
A. is under development by leading scholars.
B. has been available to firms for many years.
C. has reduced the complexity of global leadership development.
D. is unlikely, given the complexity of the process.
E. B and C.
All of the following are part of the e-commerce readiness index except:
A. mobile phones per 1,000.
B. number of PCs per 1,000.
C. electricity consumption.
D. Internet hosts per million people.
E. two of the above.
Team coaching is critically important in global teams because:
A. with high levels of diversity, team members who don’t know each other are likely to
expect poor performance.
B. team members need coaching to cross cultural barriers.
C. global teams are challenged with diversity, which leads to innovation.
D. without coaching, each separately located member is likely to work independently.
Foreign environmental forces often operate differently than domestic environmental
forces because:
A. they are uncontrollable.
B. force values are different.
C. changes are difficult to assess.
D. two of the above.
E. all of A, B, and C.
The Right Stuff model of global leadership development:
A. focuses on the needs of the firm and develops managers who bring some of the right
stuff with them.
B. suggests that global leaders are born, not made.
C. looks to universities to train in global leadership.
D. relies on in-house candidates for global leadership positions.
E. assumes that the firm can provide what the global leadership candidate requires.
The area with the greatest capacities in renewables as of 2010 is:
A. the United States.
B. European Union.
C. India.
D. Japan.
Although there are many forms of strategic alliances or competitive alliances, the
alliances are often between:
A. customers.
B. competitors.
C. suppliers.
D. all of the above.
E. two of A, B, and C.
An arrangement by which one firm provides management in all or specific areas to
another firm is:
A. a license.
B. a franchise.
C. a management contract.
D. all of the above.
E. two of A, B, and C.
Because of the context in which the global team leader is acting, he or she:
A. confronts the added complexities created by globalization.
B. needs to speak foreign languages and understand foreign cultures.
C. needs to be able to cope with jet lag and cultural adjustment.
D. is sheltered from most domestic political activity.
E. needs to be aware of the possibility of terrorism, including electronic hacking.
A joint venture may be:
A. a corporate entity formed between an international firm and local owners.
B. a corporate entity formed between two or more international firms.
C. a corporate undertaking between two or more firms of a limited-duration project.
D. two of the above.
E. all of A, B, and C.
One way to avoid transaction exposure is to:
A. issue all bonds in the home currency.
B. use home-country currency for all transactions.
C. hedge the risk by a forward money market contract.
D. A and C.
International institutions offer graduating international business majors:
A. interesting career development and internship opportunities.
B. funded study-abroad programs.
C. language training in major languages used in trade.
D. export-import process training.
Which of the following is true about alliances?
A. Many alliance partners are also competitors.
B. Alliances are often difficult to manage.
C. The use of alliances is likely to decline as markets internationalize.
D. All of the above.
E. Two of A, B, and C.
Economies of scale and the experience curve:
A. explain how international trade in manufactured goods will be linked to gross
national income.
B. state that a nation will trade goods that can be produced with the production factor
that is most abundant.
C. explain why many companies will engage in international trade.
D. two of the above.
E. none of A, B, or C.
When formulating product strategies, international marketing managers must remember
that they are selling:
A. a new product.
B. an expensive product to poor people.
C. a total product.
D. hope.
E. two of the above.
According to Warren Bennis:
A. the leader inspires, while the manager controls.
B. the leader orders, while the managers requests.
C. the leader is charismatic, while the manager is a functionary bureaucrat.
D. the leader is acclaimed, while the manager is appointed.
E. the leader initiates, while the manager waits for directives.
Unlike antitrust or competition proceedings in the EU, in the United States such
proceedings:
A. may involve civil and criminal penalties.
B. are heard at the local level.
C. involve the top management team.
D. are headed by a three-judge panel.
E. two of the above.
The U.S. Export-Import Bank (Ex-Im Bank) offers the following:
A. export credit insurance.
B. guarantees.
C. direct and intermediary loans.
D. Working Capital Guarantee.
E. all of the above.
“Culture does not affect leadership attributes.” This statement is:
A. true, because leadership traits are universal.
B. true, because leadership is a top-down concept.
C. true, because the desire to be led is universal.
D. false, because all cultures understand what leadership is.
E. false, because traits understood as critical for leaders vary some by culture.