INTB 265

Identify stakeholders' decisions Judge the ethics of strategic decisions Establish moral intent Engage in ethical behavior Audit decisions

CONSIDER KNOW DECIDE ACT ASK

Which country has seen their share of world output increase the most from 1960 to today?

China

The 1930s policies protecting 4,700 U.S. sugar producers cost U.S. consumers about ______ per year.

$3 billion

Firm strategy, structure, and rivalry Factor endowments Related and supporting industries Demand conditions

1 2;5 3 4

If Kendra was working in the home office in Ohio she never would have agreed to pay the government official to speed up the delivery of the cargo; but since she is working in the company's foreign office, she agrees to the practice since it is considered normal in this country. Which philosophical approach to ethics is Kendra using to make her decision?

Cultural relativism

________ is variously defined as selling goods in a foreign market at below their costs of production or as selling goods in a foreign market at below their "fair" market value.

Dumping

Which scenario best represents a mores violation?

Bribing a government official in a country where bribery is illegal.

According to the _________, it is illegal to bribe a foreign government official to obtain or maintain business over which that foreign official has authority.

Foreign Corrupt Practices Act

Right-wing Totalitarianism Tribal Totalitarianism Pseudo Democracy Communist Totalitarianism Representative Democracy Theocratic Totalitarianism

Germany in the 1930s Kenya Russia China United States Saudi Arabia

According to globalization supporters, what is an advantage of globalization?

Globalization helps create jobs in all countries that participate in the global trading system.

__________ measures the total annual income received by residents of a nation.

Gross national income

How did the Smoot-Hawley Act affect employment?

It had a damaging effect on employment abroad.

Power Distance Individualism/ Collectivism Uncertainty Avoidance Masculinity/ Femininity Time Orientation

Ming Ben Elena Jiro Bill

________ gives employees the integrity to go public to the media and blow the whistle on persistent unethical behavior in a company.

Moral courage

________ justifies some limited government intervention to support the development of certain export-oriented industries.

New trade theory

Spread of Democracy New World Order and Terrorism Market-Based Systems

Totalitarianism failure; New information and communication technologies; Emergence of middle and working classes Fukuyama; Huntington Deregulation; Privatization; Legal system protecting property rights

specific tariff subsidies import quotas voluntary export restraints (VERs) local content requirements administrative policies antidumping policies ad valorem tariff

United States levies a $1 tariff on imported watches EU payments to European farmers United States restricts the number of imported video games United States asks Peru to restrict sugar exports to United States Specific % of television imports must be produced domestically Drug unapproved by FDA is banned in the United States EU imposes special tariff on very low-priced steel imports United States imposes 2.5% tariff on imported watches

Which organization was created to implement the GATT agreement?

World Trade Organization

A country that has ________ is an unattractive choice for international business.

a closed totalitarian dictatorship

People in the West tend to associate a representative democracy with

a market economic system.

The more flexible approach to time that has emerged in parts of Miami where there are large immigrant populations suggests that

a nation's culture is not static.

If Italy is more efficient at producing fine leather shoes and handbags, then Italy has a(n)

absolute advantage.

John, an American executive, learns that a foreign subsidiary hired a 12-year-old orphan girl to work on the factory floor. He knows that using child labor is in direct violation of the company's own ethical code. At the same time, he does not think that denying the child her only source of income is right. John is facing

an ethical dilemma.

Declining trade barriers Declining investment barriers Enhanced communication technologies Enhanced transportation technologies

better ability to export goods better ability to optimize location economies growth in e-commerce lowered distance between countries

U.S. candy makers have responded to the tariffs and price floor policies that were introduced as temporary measures in the U.S. sugar industry during the 1930s

by moving production to foreign markets.

In many of the world's nation-states, there has been a move away from ________ since the late 1980s.

centrally planned command economies

As a judge in France, Maurice is not allowed to interpret the law but relies on a strict set of codes to determine the outcome of a case. Which type of law is in place in France?

civil law system

A ________ economy follows the principles of collectivism as resources are allocated based on "the common good."

command

In the country of Doran, all businesses are owned by the state. The government plans production, fixes commodity prices, and also directs investments to ensure they benefit the nation as a whole and not only a few individuals. What type of economy has the country of Doran adopted?

command

According to Porter, which factor endowment would be classified as an advanced factor?

communication infrastructure

With increased economic progress, cultures across the world seem to be moving toward some universally accepted values and norms. This is known as the

convergence hypothesis.

The idea that businesspeople should consider the social consequences of economic actions when making business decisions and that there should be a presumption in favor of decisions that have both good economic and social consequences refers to

corporate social responsibility.

What political system has a government that is by the people, exercised either directly or through elected representatives?

democracy

Steve has been preparing for his trip to Sweden. He has learned that in Sweden a tradition called Academic Quarter helps to define the acceptable time for arriving for meetings. Steve is

demonstrating cross-cultural literacy.

A country that abolishes laws that regulate private enterprises and removes price controls is in the process of

deregulation.

If a country exercises tight control over prices and output, prohibits private enterprises from operating in most sectors of the economy, and severely restricts foreign direct investment and international trade, it is against the practice of

deregulation.

What was the motivation for non-U.S. firms to begin investing across national borders in the 1970s?

desire to disperse production activities to optimal locations

The main reason that gross national income figures can be misleading is because they

don't consider differences in the cost of living.

Which of the following BEST increases a country's competitive advantage and its attractiveness as a location for international business?

education system that is well developed

Shayla is from South Africa and believes that the customs and beliefs of her culture are superior to those she has encountered during her trip to America. Shayla's attitude is an example of

ethnocentrism.

Karvel lives in northern California where there is sufficient land and labor to successfully grow grapes for wine. Heckscher-Ohlin would consider the land and labor to be

factor endowments.

The labor, energy, land, and capital that a company has access to are known as

factors of production.

California-based Urban Health Source has invested resources in business activities in Italy. What type of business activity does this represent?

foreign direct investment

Apple's investment in production facilities in China to produce its iPhone can best be described as

foreign direct investment.

Which of these is not used to determine culture?

geography

Economist Robert Reich advocates that the outsourcing of productive activities to different suppliers results in the creation of

global products.

Apple sources parts for its iPhone from around the world before assembling the phones in China. This reflects the

globalization of production.

One cost-cutting measure used by Garr Tool Corp. is sourcing the parts it uses from companies in Germany, Ireland, and Canada that are more economical than home-country sources. The choice to use these sources is an example of the

globalization of production.

The merging of national markets that have historically been distinct and separate is the process of

globalization.

In a pure command economy, the prices at which goods and services are sold are planned by the

government.

A payment made to expedite or to secure the performance of a routine governmental action is called a

grease payment.

Within the context of the individual as the basic unit of a social organization, what is an implication of the emphasis on individualism in many Western societies?

high degree of managerial mobility between companies

In the Republic of Nabu, natives are resistant to change and do not like to take risks. They value job security and retirement benefits. In addition, they have a strong need for rules and regulations. Based on this information, the Republic of Nabu demonstrates which cultural dimension identified by Hofstede?

high uncertainty avoidance

Italy has a direct restriction on the amount of metal products that may be imported into the country. Which instrument of trade policy does this reflect?

import quota

High tariff barriers and subsidies in the agricultural industry ultimately lead to

increased prices for consumers.

When Aristotle said that private property is more highly productive than communal property, he was advocating for

individualism.

The development of new products, processes, organizations, management practices, and strategies is called

innovation.

Canadian company Yummy Snacks exports a number of products to consumers in Peru, Chile, and Argentina. According to this information, Yummy Snacks is most likely involved in

international trade.

The practices of bribery

is a normal part of business in some countries.

U.S.-based Centra Corporation is hesitant about entering into a licensing agreement with Fission, Inc., a company from another nation, due to the likelihood that Fission will break a contract or expropriate property rights. What specific type of risk is Centra Corporation trying to avoid?

legal

An implication of trade barriers for business practice is that they

limit a firm's ability to serve a country from locations outside of that country.

When the management team reviewed its government contract on office furnishings, they noticed that in order to bid on the project, at least 44 percent of the value of the office furniture had to be produced in the United States. This stipulation is an example of a(n)

local content requirement.

James is the warehouse supply manager for a major tool corporation. It is his job to take inventory of the tools the company has available and send orders to make more tools when supplies run low. This supply and demand form of production is an example of a ________ economy.

market

Kevin lives in a nation that encourages the production of goods for exporting and to satisfy the needs of the nation's citizens so fewer imports are needed. Which trade theory does this reflect?

mercantilism

Connor asked the management team to consider how they would feel if they were asked to travel more than 50 miles to get to work—which is what they were asking the management team at the foreign office to do. Connor is relying on ________ to approach this ethical situation.

moral imagination

Which approach suggests that nations may benefit from trade even when they do not differ in resource endowments or technology?

new trade theory

The social rules and guidelines that prescribe appropriate behavior in particular situations are called

norms.

Your U.S.-based company wants permission to build a factory in a foreign country. You have been asked to pay a bribe in order to get the paperwork approved. You should

not pay because doing so is prohibited by the Foreign Corrupt Practices Act.

If gross national income per capita adjusted for differences in the cost of living is about $13,000 in China, a developing country, and is about $56,000 in the United States, a developed country, then

on average, Americans can afford more goods and services than their Chinese counterparts.

Moral philosophers argue that companies have a responsibility to give back to society as a means of offsetting the ____ they have as a result of their control over resources and ability to move production from one country to another.

power

One root cause of unethical behavior in business is

pressure to meet unrealistic performance goals.

Raymond Vernon noticed that in the 1960s, the wealth and size of the U.S. market was a natural incentive to develop new consumer products. What theory did he propose based on this fact?

product life-cycle

In the United States, citizens have the right to elect officials who make decisions on behalf of the public. This practice is the reason the United States is a

representative democracy.

The United Nations Convention on Contracts for the International Sale of Goods (CISG) was introduced to

resolve disputes that arise in international trade regarding which country's laws to apply.

For U.S. consumers and workers, the tariffs and price floor policies on the sugar industry have

resulted in higher prices and fewer jobs.

A foreign government was not enforcing its intellectual property rights, which resulted in massive copyright infringements. In turn, this was costing U.S. companies millions of dollars in lost sales revenues. To force the country to play by the rules, the United States threatened to impose trade sanctions on a range of imports from the country's businesses. The underlying motive for intervention by the U.S government was

retaliation.

Which philosophical approach is typically associated with managers from developed nations, and claims that a multinational's home-country standards of ethics are the appropriate ones for companies to follow in foreign countries?

righteous moralism

Connor was born into a poor family, but he worked hard during high school and went on to receive his master's degree in business. Today, he is considered "upper middle class" and enjoys a comfortable lifestyle. Connor's journey is an example of

social mobility.

The social strata evident in a society is primarily derived from

socioeconomic characteristics.

A tax of 32 cents is levied for each pair of eyeglasses imported into a nation. This is an example of a(n)

specific tariff.

In order to encourage the agricultural industry, the French government provided low-interest loans for the purchase of seeds and fertilizers. The government also gave cash grants and made tax reductions. Which instrument of trade policy is being used by the French government?

subsidies

GNI figures are helpful in understanding an economy because they

tell us how poor a country is relative to another.

The base for the adjustment of purchasing power parity is the cost of living in

the United States.

The primary reason Apple established production facilities in China for its iPhone was to capitalize on

the ability of subcontractors to rapidly respond to changes in demand.

Krisp Systems decides to move production to a developing country where they are free to pump pollutants into the atmosphere without legal restriction. By doing this, the company is contributing to

the global tragedy of the commons.

Who benefits from corporate social responsibility?

the local community

In his theory of absolute advantage, Adam Smith advocated that ________ should determine what a country imports and what it exports.

the market mechanism

The Heckscher-Ohlin theory is based on the idea that

the pattern of international trade is determined by differences in factor endowments.

The spread of democracy among countries is most likely to lead to

the promotion of greater competition.

Why was the World Trade Organization established?

to police the international trading system

Saturn Systems Inc., which is headquartered in the United States, has its production plant located in a less-developed country where working conditions are poor. For example, employees work 15-hour shifts, are exposed to toxic chemicals, and are forced to work overtime. What type of behavior is Saturn Systems Inc. exhibiting?

unethical

Jacques relies on a cost-benefit analysis to decide if moving operations overseas is better than increasing the size of the current manufacturing facility in the United States. He is using the ________ approach to ethics to determine his answer.

utilitarian

The ________ approach to ethics holds that the moral worth of actions or practices is determined by their consequences and is committed to the maximization of good and the minimization of harm.

utilitarian

According to the product life-cycle theory, once a new product becomes widely accepted internationally then production for that product

will start to take place in other countries.