Chapter 3 I look for the best product and price

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Answers to Questions in the Text

Chapter 3: Managing Diversity in a

Global Environment

WORK APPLICATION SAMPLE ANSWERS

Most of the answers are actual student answers or based on student answers. You may give these

answers as part of your lecture before, after, or in place of getting student answers.

3–1. Classify a business you work for or have researched as domestic, international, or

multinational. If the business is international or an MNC, list some of the countries in which it does

business.

I worked for McDonald’s, and it has restaurants all over the global village. The United States, all EU

3–2. Do you try to buy American products? Should you?

3–3. Give an example of how a domestic company benefits from trade barriers.

If the government puts a barrier on a product, like a Samsung smart phone, it will most likely cost

3–4. Would you be willing to pay more for the same product made domestically than abroad? For

example, if Nike made sneakers in America and sold them for $125 and made them abroad and

sold them for $100, which would you buy?

3–5. Select a business and identify how it uses global sourcing and/or importing and exporting.

3–6. Select a business you buy from that has a global license or franchise.

I have an old Starter Lions football jacket that it had a license to use from the NFL.

3–7. Select a business you buy from that used contract manufacturing to make your product.

3–8. Select a business that uses strategic alliances, joint venture, and/or direct investment

globally.

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3–9 Select a company and identify as many of its global business practices as you can.

Amazon.com uses global sourcing of its books and other items it sells by having UPS deliver them

3–10. Explain how diversity is important to your current or past workplace.

3–11. First state the types of diversity where you work(ed). Next, describe how it has affected you

personally by being discriminated against, including being unfairly treated through being criticized

or excluded in some way for being different in some way from the others.

In my department we have nine people. Ages range from around 35 to 65, there are seven men and

3–12 Describe a company’s policies and practices for promoting diversity, preferably a business

you work(ed) for.

In my company we do yard work, and the majority of the employees are of minority groups, mostly

3–13. Give an example of cultural diversity you encountered, preferably at work.

I work in a U.S. factory. We have many Hispanics working there. Some can hardly speak English, so

3–14. How do you feel about taking an international assignment? What countries would be more

appealing to you?

I’d like to go one of the major European countries, especially England because they speak English

REVIEW QUESTION ANSWERS

3–1. How are businesses classified in the global village?

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3–2. What are the four trade barriers?

3–3. What is the role of the World Trade Organization (WTO)?

3–4. What are the six major trade agreements?

The six major trade agreements are NAFTA, CAFTA-DR, UNASUR, EU, ASEAN, and APEC.

3–5. Which country has the foreign trade advantage based on exchange rates?

3–6. What is the difference between a license and a franchise?

In licensing, a licensor agrees to give a licensee the right to make its products or services or use its

3–7. What is the difference among a strategic alliance, joint venture, and direct investment?

A strategic alliance is an agreement to share resources that does not necessarily involve creating a

3–8. What do international and multinational companies have in common?

3–9. If you were to start your own small business, would you most likely use contracting, strategic

alliances, joint ventures or direct investment?

As discussed, small businesses are commonly international and are more likely to use contracting or

3–10. What is the difference between diversity and affirmative action?

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Affirmative action is purposeful steps to create employment opportunities for minorities and

3–11. What is the glass ceiling?

3–12. When dealing with people with disabilities, what should be the focus?

The focus should be on the abilities people with disabilities have and matching them to jobs they are

3–13. What are three practices used to promote diversity?

3–14. What are the five dimensions of Hofstede’s Cultural Diversity?

Power distance inequality versus power equality, individualism versus collectivism, assertiveness

3–15. What is GLOBE?

3–16. What are the nine dimensions of Project GLOBE?

Assertiveness, future orientation, gender differences, uncertainty avoidance, power distance,

COMMUNICATION SKILLS ANSWERS

3–1. How does globalization affect your life and that of your family and friends?

3–2. Should people in the United States make an effort to buy products made in America? If so,

how should “made in America” be defined?

Answers will vary.

3–3. Should your home country drop all or some of its trade barriers?

3–4. Is the North American Free Trade Agreement (NAFTA) of more benefit or harm to the United

States? Why?

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3–5. Should there be one global trade agreement rather than the six major agreements?

Answers will vary.

3–6. Should countries with a trade deficit create barriers to trade to eliminate the deficit?

3–7. Overall, are the effects of foreign trade more positive or negative for your home country?

Answers will vary, but as stated in the textbook, it should be positive for most people. However, if

3–8. Is it too difficult and time consuming to engage in global sourcing?

3–9. Are smaller international companies at a disadvantage when competing with large MNCs?

Answers will vary, but generally the answer is yes and no. Internationals don’t have the finances, but

3–10. How does diversity effect you personally? Do you really value diversity?

3–11. What experience have you had with each of the diverse groups?

I’ve had to work with people of all ages, both males and females but mostly males, my best friend at

3–12. How can you improve your awareness and empathy for diverse groups?

Answers will vary, but completing Self-Assessments 3–2 and 3–3 can help to identify areas that need

3–13. Identify mentors you have had in your life (relatives, friends, teachers, coaches, managers)

and how they helped you to succeed. Also, will you seek out a mentor(s) to help you advance in

your career?

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3–14. Should expatriates be given global cultural diversity training, and should their families get

training too?

At the cost of a $1 million for a three-year international assignment, and with family adjustment to

APPLYING THE CONCEPT ANSWERS

Applying the Concept 3–1:Global Practices

Identify each practice as more likely to be used by large or small global companies:

A. large MNCs

B. small international companies

1. Companies that develop a product in one country and then bring the product to other countries.

2. Companies that only import and/or export to operate globally.

B. Small international companies. They don’t have the resources to have their own facilities in other

3. Companies that have foreign nationals among their top-level managers.

A. Large MNCs. They have foreign nationals running direct investment facilities.

4. Companies that make their products in other countries.

5. Companies that develop the latest technology through R&D.

Applying the Concept 3–2:Forms of Global Business

Identify which activity or form of global business is described in each statement.

A. global sourcing

B. importing and exporting

C. licensing and franchising

D. contracting

E. strategic alliance and joint venture

F. direct investment

6. Springfield College offers a master’s degree program in Israel at the Health and Behavioral

Sciences College, which provides the facilities and administrative support.

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E. Joint venture and Strategic Alliances. This is a strategic alliance, which is a form of partnership

7. Philips in France makes TVs using speakers from Japan.

A. Global sourcing. This is using foreign resources/parts as part of its final product.

8. Tires R Us in the United States buys tires from Bridgestone in Japan for retail sale.

9. Chinese Alibaba buys a warehouse in America to distribute online orders in the United States.

F. Direct investment. Buying a building is a direct investment.

10. The American Children’s Television Workshop gives a Chinese company the right to make its

Sesame Street character puppets.

C. Licensing. Licensing involves allowing another country the right to use an asset.

11. Whirlpool makes its appliances in its factory in Russia.

12. Dell assembles its computers in the United States and sells them online to people globally.

B. Exporting/Importing. Selling computers in another country and shipping them is exporting.

13. Costco has a Canadian company make some of its Kirkland brand items for sale in its U.S.

stores.

14. Wilson Sporting Goods buys the rubber for tennis balls from Brazil.

15. McDonald’s makes a deal with an Italian businessperson to open a McDonald’s in Rome.

Applying the Concept 3–3: GLOBE Dimensions

Identify the dimension of cultural diversity exemplified by each statement.

A. assertiveness

B. future orientation

C. gender differences

D. uncertainty avoidance

E. power distance

F. societal collectivism

G. in-group collectivism

H. performance orientation

I. humane orientation

16. The people in this country have one of the highest savings rates in the world.

17. Managers throughout organizations in this country focus on getting the job done through

teamwork.

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18. People in this country are known to be difficult to negotiate with.

I. Humane orientation. Providing poor working conditions shows low caring toward people.

19. In some companies in this country, the male managers go around kissing the female

employees good morning; and the women get the coffee for the male managers.

20. The people in this country follow the football/soccer team closely as they take great

satisfaction from watching their team in the World Cup.

H. Performance orientation. The statement illustrates high achievement and material success. You

21. Managers place great importance on status symbols such as having the executive dining room,

reserved parking spaces, and big offices.

22. Managers don’t really care about the safety of their employees and provide poor working

conditions.

I. Humane orientation. Providing poor working conditions shows low caring toward people.

23. Employees get nervous and stressed when they even hear that changes are coming.

24. Employees focus on constant small changes to make the products and processes better.

JOIN THE DISCUSSION ANSWERS

Join the Discussion 3–1: Buy American

You most likely have heard the slogan “Buy American.” Many labor unions urge Americans to buy

products made in the United States, because that helps retain jobs for American workers. On the

other hand, some Americans ask why they should buy American products if they cost more or their

quality or style is not as good as that of foreign-made products. But as you’ve seen, it isn’t always

easy for consumers to know the country of ownership of many products they buy.

1. Is it ethical and socially responsible to ask people to buy American?

2. Is it ethical and socially responsible to buy foreign products?

Join the Discussion 3–2: File Sharing

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Since the early 2000s, some peer-to-peer (P2P) file-sharing networks and services have been

targeted by music companies and an industry watch group, the Recording Industry Association of

According to the International Federation of the Phonographic Industry, piracy is a real problem, as

95% of all music downloads violate copyrights. (1) In many countries, because some governments

don’t have the desire or resources to enforce copyright laws, some governments even resist allowing

companies to take legal action against companies and individuals.

1. Is it ethical and socially responsible for file-sharing companies to give people the means to

download music, movies, or software for free?

2. Is it ethical and socially responsible for people to download music, movies, or software for free,

which prevents recording, film, or software companies and artists from getting any royalties?

3. Is it ethical and socially responsible for countries to ignore and even resist enforcing copyright

laws? Should all countries enforce copyright laws?

Answers vary

Join the Discussion 3–3: Speaking English

The United States was once known as the “melting pot,” as people from all over the world came to

the country and adjusted to its culture. In the past, generally, immigrants had to learn English to get

a job. Today, however, many organizations hire people who can’t speak English, and they use

translators and have policies written in multiple languages for these employees. Government

agencies at the federal, state, and local levels are also providing translators and written materials in

other languages.

1. Why are some organizations no longer requiring workers to speak English?

2. Should a worker be required to be able to speak English to get a job in the United States?

3. Is it ethical and socially responsible to (or not to) hire people who can’t speak English and to

provide translators and policies written in multiple languages?

Join the Discussion 3–4: Bribes

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An American businessperson working in a foreign country complained to a local telephone manager

that the technician showed up and asked for a bribe before installing the phone. The businessperson

refused, so the telephone worker left without installing the phone. The telephone company manager

told the businessperson that the matter would be investigated, for a fee (bribe).

1. Is it ethical and socially responsible to pay bribes?

2. Should the businessperson have paid the bribe to get the phone installed?