chap. 7 quiz questions

A weaker US dollar is an economically favorable exchange-rate shift for manufacturing plants based in the US -Yes, because it provides for a weakened foreign demand fo US goods -Yes, because it makes such plants less competitive with foreign plants -This is a true statement -No, the US dollar must be stronger -Yes, because provides incentives of foreign companies to locate manufacturing facilities in the US to make goods for US consumers

This is a true statement

Profit sanctuaries are country markets or geographic regions where: - a company can rank the competitive advantage opportunities in each industry. - a company possesses good strategic fit with other businesses and identifies the value chain where this fit occurs. - a company derives substantial profits because of its protected market position or unassailable competitive advantage. - a company creates substantial investment strategies because it is losing competitive advantage over competitors. -a company invests its dividends in expanding its foreign market presence.

a company derives substantial profits because of its protected market position or unassailable competitive advantage.

A 'think-global, act global' strategic theme puts emphasis on: -ensuring that value chain activities are defined by country-specific attributes to capitalize on economies fo scale -executing a global domination strategy that focuses on. company's resource strengths. on entry strategies across all country boundaries -elevating resources and capabilities developed on a country-by-country basis so as to capitalize on country's uniqueness -implementing mass customization techniques that can address local preferences efficiently -building a global brand name and aggressively pursuing opportunities to transfer ideas, products, and capabilities from one country to another

building a global brand name and aggressively pursuing opportunities to transfer ideas, products, and capabilities from one country to another

What is the foremost strategic issue that must be addressed by firms when operating in two our more foreign markets ? -deciding on degree of globalization to maintain expansion capabilities -deciding on resources and capabilities of allies -deciding on the degree to vary its competitive approach to fit the specific market conditions and buyer preferences in each host country -deciding on relative cost competitiveness of the home country -deciding on appropriate level of sustainable profitability

deciding on the degree to vary its competitive approach to fit the specific market conditions and buyer preferences in each host country

The primary reasons that companies opt to expand into foreign markets are to: -boost returns on investment, balder their product lines, avoid tariffs and trade restrictions, and escape dealing with strong labor unions -gain access to new customers, achieve lower costs, enhance company's competitiveness, capitalize on core competencies, and spread business risk across wider market base -grow sales faster than industry average, reduce competitive threats from rivals, open up more opportunities to enter into strategic alliances -avoid having to employ an export strategy, avoid the threat of cross-market subsidization from rivals, enable use of global strategy instead of multi domestic strategy

gain access to new customers, achieve lower costs, enhance company's competitiveness, capitalize on core competencies, and spread business risk across wider market base

A 'think local, act local' multidomestic type of strategy is: - very risky, given fluctuating exchange rates and propensity of foreign governments to impost tariffs on imported goods -is more appealing when the county-to-country differences in buyer tastes, cultural traditions, and market conditions are diverse -generally an info strategy when one or more foreign competitors are pursuing a global, low-cost strategy -usually defeated by a 'think global, act global' strategy -can defeat a global strategy if the 'think local, act local' multidomestic strategist concentrate its efforts exclusively in those foreign markets which have superior resources

is more appealing when the county-to-country differences in buyer tastes, cultural traditions, and market conditions are diverse

Difference between political risks and economic risks is: -political risks stem from instability or weakness in national governments, while economic risks stem from the stability of a country's monetary system, and its economic and regulatory policies -political risks stem from stability of a country's monetary system, while economic risks stem form the instability of the monetary system -political risks stem from the hostility to foreign currencies, while economic risks stem from instability of monetary system -political asks stems from stability in foreign business, economic risks stem from excess of property right protections -political risks stem from exchange rate fluctuations, while economic. risks stem from hostility to foreign business

political risks stem from instability or weakness in national governments, while economic risks stem from the stability of a country's monetary system, and its economic and regulatory policies

The transnational approach of a firm using a 'think-global, act local' version of a global stategy entails: -pursuing the same basic competitive strategy theme in all countries where the firm does business but giving local managers some latitude to adjust product attributes to better satisfy local buyers and to adjust production, distribution, and marketing to be responsive to local market conditions -little or no strategy coordination across countries -producing/marketing a variety of product versions under the same brand name, w each different version being designed specifically to accommodate the needs/preferences of buyers in a particular country

pursuing the same basic competitive strategy theme in all countries where the firm does business but giving local managers some latitude to adjust product attributes to better satisfy local buyers and to adjust production, distribution, and marketing to be responsive to local market conditions

One of thee biggest strategic challenges to competing in the international area includes: -how to identify foreign firms licensed to produce and distribute company's products -whether to offer a standardized product worldwide or a customized product offering in each different country market -how to leverage opportunities from shifting exchange rates -how to charge the same price in all country markets -whether to pursue a franchising strategy or joint venture strategy

whether to offer a standardized product worldwide or a customized product offering in each different country market