1) It is difficult to compare globalization of business over time because shifting national
borders have changed the nature of transactions from domestic to international and vice
versa
2) The primary duty of the customs agency of a government is the assessment and
collection of all duties, taxes, and fees on imported merchandise.
3) The U.S. dollar is so widely traded partially because the New York Stock Exchange
is the biggest foreign-exchange center in the world.
4) Normativism asserts that universal standards of behavior exist and should be
accepted in all cultures.
5) A divisional structure tends to be adopted by firms that are diversified by products or
markets.
6) An NGO is a private institution independent from the government.
7) Pender Pet Products is considered an opportunistic importer because the firm seeks
products around the world that it can import and sell profitably to domestic consumers.
8) A major problem with MNEs using offshore financial centers is that they may give
unfair tax advantages to companies.
9) Although capital intensity is growing in most industries, labor compensation remains
a significant cost for most companies.
10) Two forms of equity financing are private placement with a venture capital firm and
the equity capital market, otherwise known as the stock market.
11) A differentiation strategy is a unique mixture of the multidomestic and global
strategies whereby the company attempts to capture the advantages of both.
12) Gap analysis may show that the combined market potential among several countries
may justify product development costs.
13) Current approaches to designing an organization see the task of building
knowledge-generating and decision-making relationships as less important than
specifying the best structural arrangement.
14) A company adopting a ________ strategy will likely aim to develop an organization
culture that helps employees around the world unconditionally accept common goals
and practices.
A) domestic
B) multidomestic
C) national
D) global
15) Kyle, an international manager for Apex Industries, has been given the task of
analyzing the economies of three different emerging countries for the firm’s potential
expansion. Which of the following questions is LEAST relevant to Kyle’s assignment?
A) How much freedom will Apex have to run its foreign operations?
B) What are the current economic policies related to development?
C) What is the likelihood that Apex can fill manufacturing positions with locals?
D) What factors in the country drive or hinder economic change?
16) A ________ takes into account the complete costs of ownership, such as storing and
transporting inventory, and of disposal.
A) total cost analysis
B) cost-benefit analysis
C) make-or-buy decision
D) flexibility strategy
17) A push strategy for international sales is most likely preferable to a pull strategy
when ________.
A) there are few prohibitions on advertising
B) the price of the product is high relative to incomes
C) people rely on friends’ opinions before buying a product
D) literacy rates are high
18) Which of the following is a drawback of the polycentric approach?
A) Host-country nationals become more committed to company headquarters than to
their local colleagues
B) Successful local units may increasingly function independently and pay less
attention to headquarters
C) Local units depend too much on headquarters for resources and innovations, with
little incentive to develop their own
D) Local managers study international business and cultural practices in other markets
in preparation for international assignments at the expense of not fully investing in
understanding the host country
19) The major objective of the European Central Bank is to ________.
A) set monetary policy for EU countries that adopt the euro
B) ensure that EU interest rates are equal to U.S. rates
C) control taxes as a means of monitoring EU debt
D) reduce spending by EU countries
20) Which of the following statements about Costa Rica and its approach to trade and
factor-mobility strategy is true?
A) Costa Rica decided to select industries that would produce competitive products and
improve workers’ skills
B) Costa Rica decided to attract industries acceptable to its major trading partners
C) Costa Rica decided to select industries on a least cost basis
D) Costa Rica decided to invite industries that were highly technical
21) Which of the following would most likely be used in a totalitarian system to
promote unconditional support for the official ideology?
A) privately owned media outlets
B) a parliamentary system
C) state control of the education system
D) a representative legislative body
22) In a country that emphasizes collectivism, ________.
A) the interests of the individual are more important than the interests of the state
B) one person or political party exercises absolute control over the political and
economic systems
C) the needs of society and the needs of individuals are treated as equally important
D) the needs of society take precedence over individual freedoms
23) Demographers project that the share (percentage of population) of what we now
consider the working-age population in developed countries will decrease up to the year
2050. Which of the following is the most likely result of this trend?
A) an increase in foreign exchange among trading blocs
B) an increase in FDI provided by developed economies
C) a higher percentage in per capita GDP in today’s developing economies than in
today’s developed economies
D) a higher percentage in per capita GDP in today’s developed economies than in
today’s developing economies
24) In designing an export plan, managers initially do all of the following EXCEPT
________.
A) sequence tactics
B) specify objectives
C) identify useful resources
D) organize financial support
25) The widening set of interdependent relationships among people from different parts
of the world is known as ________
A) globalization
B) offshoring
C) franchising
D) outsourcing
26) Which of the following is NOT one of the common ways that trade intermediaries
are paid by exporters?
A) commission rate
B) buy-sell basis
C) fixed salary
D) special event contribution
27) Hudson Manufacturing is an MNE based in the U.S. with operations in Asia. The
firm is considering expansion into the European Union. Executives at the firm are
debating whether central Europe or Eastern Europe would be best for the firm. Which
of the following best supports a decision to establish operations in Eastern Europe?
A) Hudson wants to implement a high-performance work system
B) Hudson plans to staff the foreign facility with local managers
C) Hudson wants to minimize costs by keeping wages low
D) Hudson recently lost money in a joint venture
28) The vigor of IPR protection is highly related to a country’s stage of ________.
A) economic development
B) cultural heterogeneity
C) natural resource development
D) standardization of patent regulations