International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
21 Instructor’s Manual – Module 7 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
6. What social, political, and economic conditions might signal the existence of a large
underground economy, and why should managers pay heed to such signals?
7. Why is income distribution important to marketers in international companies? What
might be the attraction and concerns associated with relatively even distribution of income,
and with highly uneven income distribution, and how might this assessment be impacted
based on the level of the economy’s economic development?
8. The staff economist of a large multinational with a Turkish subsidiary has given the
firm’s chief financial officer a report on Turkey’s foreign debt situation, as shown in Figure
7.7. What concerns might the chief financial officer have?
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
9. In developing economies, what factors are associated with reduced birthrates and
what is the logic of these associations?
10. What implications might the rural-to-urban shift in developing countries have for
international companies?
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
MINICASE: The Impact of Galawi’s Development Policy
1. Describe the two strategies for the CEO.
2. Explain how the change in development strategy will affect the firm in many ways.
3. What changes in its entry plans will the firm have to make?
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
BONUS ACTIVITIES (additional resources not in the text)
This section provides you with support of your course above and beyond what’s found in the
text. We have developed these resources to support your course, to support your traditional,
hybrid, flipped, or online class.
VIDEO SUGGESTIONS
McGraw Hill’s collection of international business videos is available on pinterest at
and social welfare.
See https://www.pinterest.com/pin/387591111650417017/ for a discussion of “Cubans Grapple
with Challenges, Promises of Economic Change” to discuss various economic and socioeconomic
issues raised by opening Cuba up to international trade and investment.
The video on “Big Mac Index – explained” provides a cartoon-based explanation of the Big Mac
especially in the developing nations, and how that can contribute to reduction in poverty.
GlobalEdge and the Academy of International Business provide links to a number of
organizations that offer videos about international business. You can find these links at
https://aib.msu.edu/resources/videodepositories.asp.
TEAM EXERCISES
These may be done individually or in groups or teams, either in or out of class, for later class
presentation. Some are also appropriate for use in hybrid/flipped classroom and online courses.
1. We have had good response from students when we have asked them to choose a
country and become a specialist on it. You can assign this as a term project and also ask for
short periodic verbal reports during the term. Have the students pick a country or region and
research economic and socioeconomic information about that particular country or region. To
enhance this exercise, assign students a product and ask the students to evaluate the success of
that product considering the economic and socioeconomic data they uncovered. The material
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
25 Instructor’s Manual – Module 7 | Geringer, McNett, Minor, Ball © 2016 by McGraw-Hill Education.
2. Assign various kinds of changes in the economic and socioeconomic dimensions and ask
the students to prepare a report to top management as to the expected effects of these
changes on all the functional areas of the firm. To add realism, this exercise can be assigned as
a continuation of Exercise 1.
3. Many European Union countries have low or even declining birth rates. Consider labor
compensation cost discussed in the module, and the information in Figure 7.4. Have the
students discuss the implications for EU countries and businesses in the next 25 years.
4. Many students believe the labor costs in the United States are the highest in the world.
Ask students to examine the information in Figure 7.4. Have the students explain how a country
like Norway or the United States can remain competitive over time, particularly in competition
with labor compensation costs in Brazil, Mexico and Greece. When contemplating where to
locate production facilities, what other factors must an international business manager
contemplate beyond just labor compensation costs?
5. Students are probably aware of recent economic turmoil in countries like Brazil,
Venezuela, Sudan, Spain, or Greece. Have the students pick one of these countries, or another
appropriate country that has suffered from social and political challenges due to economic
turmoil, and research the events and outcomes. What was the root cause of the economic
turmoil and what was the eventual outcome of this economic chaos (or what do they think the
eventual outcome will be)? How did international businesses respond to the situation?
6. Have students consider that they are working in the marketing department for an
international company that is analyzing market opportunities within the European Union. For
the most recent year for which data are available, what are the five EU member countries with
the highest real gross national income (GNI) per capita? For the same year, what are the five
member countries with the lowest real GNI per capita? Find similar data for EU members from
5 years earlier. Which country has had the highest percentage increase in GNI per capita?
Which has had the lowest?
SUPPLEMENTAL ACTIVITIES
Case Studies
Case studies that focus on the internationalization of business and on issues related to the
globalization debate are available through Ivey Publishing and Harvard Business School. Ivey’s
catalog is available for browsing (www. iveycases.com); the cases are downloadable and pricing
is in the U.S. $3.50 range. Harvard Business Publishing
(https://cb.hbsp.harvard.edu/cbmp/pages/home) requires an account and offers free review
copies for educators. The case prices begin in the $3.95 to $6 range.
“Wal-Mart in China 2012” examines Wal-Mart’s challenges in competing successfully in the
diverse and changing economic and socioeconomic environment that China represents. This is a
University of Hong Kong case distributed by Harvard.
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
International Business
Geringer, McNett, Minor, Ball
Instructor Guide to Module 7
CONTROVERSIAL ISSUES
1. Global Debate: The GLOBAL DEBATE: How to Best Measure Development: Economy or
2. Debate on whether India or China will be the first to achieve developed nation status