1) Using a concentrated configuration, an MNE performs value activities in different
countries.
2) Most countries’ imports account for more than half of their citizens’ consumption
3) The balanced scorecard is an approach to performance measurement that closely
links the strategic and financial perspectives of a business.
4) A company classified as a small and medium-sized enterprise (SME) has fewer than
500 employees.
5) When a pharmaceutical company charges a market price in developed countries and
a discounted price in developing countries, the company is using partial source pricing.
6) When forecasting exchange rates, forecasters must predict the magnitude, timing,
and direction of change in exchange rates.
7) Pressures for local responsiveness include cross-national differences in terms of
consumer preferences, advances in technology, and government regulations.
8) ________ people account for the largest percentage of global production.
A) English-speaking
B) Mandarin-speaking
C) French-speaking
D) Spanish-speaking
9) Country X wants to eliminate its balance of trade deficit while simultaneously
keeping prices low for imported essentials. Which of the following methods would
most likely achieve these dual objectives?
A) devaluing its currency
B) enacting selective import restrictions
C) using tight monetary policies to deflate price levels
D) spurring productivity increases through general tax breaks for industry
10) Which of the following statements describes an inconsistency of the FCPA?
A) Facilitation payments are classified as bribery
B) Facilitation payments are excluded from the FCPA’s definition of bribery
C) Payments to officials who are not directly responsible for carrying out the law are
legal
D) Payments to foreign officials who carry out the law are considered illegal by
provisions of the FCPA
11) The approach a company takes when it bases foreign operations on an informed
knowledge of its organizational culture along with home- and host-country needs,
capabilities, and constraints is called ________.
A) polycentrism
B) ethnocentrism
C) neocentrism
D) geocentrism
12) Which of the following UNDESIRABLE results will most likely occur for a
country running a favorable balance of trade?
A) higher unemployment
B) higher domestic interest rates
C) fewer funds to invest abroad
D) granting credit that may be risky
13) What is a master franchise?
A) the original agreement between the franchisor and franchisee
B) the franchisee with the highest revenue in a region
C) a franchisee with rights to open outlets on its own or develop subfranchises
D) the set of standard terms regulating the relationship between franchisor and
franchisee
14) Watson Electronics, an MNE based in Canada, tends to follow an ethnocentric
staffing model. From which group will it most likely hire for upper-level management
positions in its new facility in Germany?
A) home-country nationals
B) third-country nationals
C) host-country nationals
D) local citizens
15) A company would most likely use gap analysis to ________.
A) estimate market potential over a business cycle
B) compare sales over time
C) compare consumption potential with its own sales
D) determine the best market niches to target
16) ________ are special locations for storing domestic and imported inventory in order
to avoid paying duties until the inventory is sold.
A) Foreign trade zones (FTZs)
B) Ports of entry
C) Duty-free zones
D) Customs areas
17) Compton Cereal Company sells its cereals in most global markets, and overall sales
at the firm remain strong. However, the firm is losing sales to some of its competitors
because Compton lacks a gluten-free cereal. Which of the following best describes
Compton’s current problem?
A) usage gap
B) competitive gap
C) distribution gap
D) product-line gap
18) All of the following are problems of using a worldwide brand EXCEPT which one?
A) Brand names may carry a different association in another language
B) Pronunciation may be difficult in another language
C) Acquired brand names cannot be legally changed
D) Pictogram alphabets need visual appeal in addition to phonetic appeal
19) A price on goods and services sold by one member of a corporate family to another
is known as a(n) ________.
A) transfer price
B) tax credit price
C) passive price
D) active price
20) The measure of the value of production that occurs within a country’s borders
without regard to whether the production is done by domestic or foreign factors of
production is its ________.
A) net national product (NNP)
B) gross national product (GNP)
C) gross domestic product (GDP)
D) gross national income (GNI)
21) Which of the following hypothetical examples would be a restriction on the import
of services?
A) The U.S. restricts foreign companies from carrying cargo between two U.S. cities
B) Japan restricts North Koreans from visiting Tokyo Disneyland
C) China does not allow the importation of rice from Thailand
D) Canada does not allow Air Canada to buy Brazilian aircraft
22) Which of the following is an example of an acquired group membership?
A) national origin
B) religion
C) gender
D) race
23) Which of the following interpretative frameworks does NOT automatically presume
that a particular nation provides a solution to every problem or an explanation for every
action?
A) ethnocentric
B) geocentric
C) polycentric
D) intercentric
24) A company that employs a ________ strategy creates value by generating customer
insights and translating those insights into innovations.
A) differentiation
B) diversification
C) cost leadership
D) innovation
25) The concept of leveraging in finance refers to ________.
A) the degree to which companies rely on foreign exchange to fund operations
B) how a company hedges its foreign currency obligations
C) the degree to which a firm funds the growth of a business by debt
D) how much cash the CFO has in the bank
26) Which of the following has the greatest amount of foreign-exchange reserves in the
world?
A) China
B) Japan
C) Russia
D) Taiwan