International Business Midterm 1 (Koepp)
Which of the following companies would be MOST likely to retain control over its trademarks in a foreign market that practices both "first-to-file" and "use it or lose it" policies?
A Chinese company that establishes its trademark in the new market and starts a small branch office in the country immediately.
Which of the following is NOT one of Hofstede's dimensions of national culture?
A is the answer A. Cultural orientation B. Social orientation C. Time orientation D. Goal orientation E. Uncertainty orientation
Which of the following is NOT an element of culture?
A is the answer A. Adaptation B. Values and attitudes C. Social structure D. Religion E. Language
Which of the following BEST describes the difference between a multinational corporation and a multinational organization?
A multinational organization is an organization that has involvement in multiple countries and may be for-profit or not-for-profit; a multinational corporation is a for-profit organization that has involvement in multiple countries.
Which of the following BEST describes the difference between the way a person from an Anglo country would define family and the way a person from an Arab country would define family?
A person from an Anglo country would likely include only parents and siblings; a person from an Arab country would likely include cousins, uncles, and in-laws as well.
Which of the following BEST describes the difference between a highly socially stratified country and a less socially stratified country?
A person in a highly socially stratified country would be offended to work alongside someone from a lower stratum; a person in a less socially stratified country would likely not be aware of such distinctions.
What is the general purpose for "backtranslation"?
A way to assure oneself that a translated phrase is correct when translated back into the original language.
The process by which people not only understand a foreign culture, but also modify and adapt their behavior to make it compatible with that culture is called ________.
Acculturation
Which of the following best describes a culture that changes in response to external factors?
Adaptive
Why do countries with access to advanced technology avoid selling their technology to countries with weak intellectual property laws?
Advanced technology loses its market value if it is illegally copied and disseminated.
The five Central Asian republics of the former Soviet Union—Kazakhstan, Uzbekistan, Tajikistan, Turkmenistan, and Kyrgyzstan—have much in common. Of the following, which is NOT one of important things they have in common?
All have arable land
Point Technologies and its distributor in Singapore signed an International Distribution Agreement. In the event of a dispute, they have agreed not to rely on Singaporean or U.S. courts, but to have a third party hear the dispute and decide right and wrong. What is this process normally referred to as?
Arbitration
Which of the following areas have aggressive, efficient entrepreneurs who have increasingly put competitive pressure on firms in other areas to improve their productivity and the quality of their products?
Asia
Which is NOT one of the elements of the model developed by Pankaj Ghemawat, of IESE Business School in Barcelona, as a useful framework for understanding the operating challenges facing international businesses because of national differences?
B. A. Geographic distance B. Labor distance C. Economic distance D. Administrative distance E. Cultural distance
Which of the following describes a similarity between transfer risk and ownership risk?
Both risks are directly related to governments either seizing businesses or their profits.
What are the BRIC countries?
Brazil, Russia, India, and China
Which of the following is NOT true about Canada's attractiveness in the international marketplace?
C is the answer A. Close proximity to the U.S. B. Stable political system C. No internal threats or factions Your answer is correct. D. Stable legal system E. Excellent infrastructure and educational system
Which of the following is NOT a characteristic of culture?
C is the answer A. Culture is shared. B. Elements of culture are interrelated. C. Culture is unchanging and immutable. D. Culture reflects learned behavior. E. Culture is adaptive.
Which of the following country environments can MNCs NOT influence?
C is the answer A. Political B. Economic C. Historical Your answer is correct. D. Cultural E. Technological
Which of the following is an example of a version of English taught to non-native speakers that is sufficient to conduct business?
Caterpillar Fundamental English
Dual-use technologies have applications that can be used for which of the following?
Civilian and Military purposes
Which of the following describes a principal difference between common law and civil law systems?
Common law grows out of a collection of court rulings, whereas civil law is based on detailed written codes of law.
Linguistic ties often create which type of important advantage because the ability to communicate is so important in conducting business transactions?
Competitive
Which of the following is FALSE regarding emerging markets?
D is False A. Some scholars limit the term to the BRIC economies. B. Just two of the emerging markets together account for more than one-third of the world's population. C. Some researchers use the term to describe the so-called Big Ten. D. There is a universally accepted definition of the countries to be included in the emerging markets category. Your answer is correct. E. They are defined as countries whose recent growth or prospects for future growth exceed that of traditional markets.
Which of the following is NOT an area designed to regulate the domestic economic environment?
D is the answer A. Financing operations B. Workforce management C. Product marketing D. Religious practice Your answer is correct. E. Technology development
Which of the following describes a difference between international and domestic business?
D. A. Domestic business involves transactions between corporations; international business involves transactions within one corporation. B. Domestic business involves importing only; international business involves both importing and exporting. C. Domestic business involves transactions within one corporation; international business involves transactions between corporations. D. Domestic business involves transactions that use one currency; international business involves transactions that use multiple currencies. E. Domestic business involves transactions that use two currencies; international business involves transactions that use more than two currencies.
While most countries have passed laws protecting intellectual property, which of the following agreements is NOT specifically written to protect intellectual property rights?
E is the answer A. Universal Copyright Convention B. The Paris Convention C. Berne Convention for the Protection of Literary and Artistic Works D. Trade-Related Intellectual Property Rights Agreement E. North American Free Trade Agreement
A country whose recent growth or prospects for future growth exceed that of traditional markets is known as which of the following?
Emerging market
Amaya is a native English speaker. Which of the following is a disadvantage to her in communicating with international business associates?
English speakers feel little need to learn a second language.
You are an American business owner operating a steel mill in a foreign country. After a violent revolution, the country's new government determines that your mill should be nationalized. It seizes the company, but offers you fair market value in cash for its assets. In which of the following has the country engaged?
Expropriation
During the Cold War between the United States and the Soviet Union, many scholars divided the world into three regions. Which of the following BEST describes the difference between a First World nation and a Third World nation?
First World nations were wealthy and usually had political and economic ties to the United States; Third World nations were poor and were primarily located in Africa, Asia, and Latin America.
Which of the following is a type of international investment that involves the purchase of foreign financial assets for a purpose other than control?
Foreign Portfolio Investment
ABC Medical Products acquires 51 percent of XYZ Productos Medicos, a Mexican corporation. Which of the following is this an example of?
Foreign direct investment (FDI)
Which of the following countries exerts strong leadership within the EU, and has led the promotion of common European defense and foreign policies and strengthening human and workers' rights in the EU?
France
Of the following countries, which represents the European Union's most important member?
Germany
___________________ was the Soviet leader whose economic and political reforms led to the Soviet Union's collapse in 1991 and subsequent declarations of independence by the 15 Soviet republics.
Gorbachev
Central America and the island states of the Caribbean are also part of North America. Which of the following countries has NOT achieved high income status and is considered politically troubled?
Guatemala
How would you characterize the U.S. on the Hofstede's Five Dimensions of Social, Power, Uncertainty, Goal and Time Orientation?
High, low, medium, medium, low
The country that Extech Corp. has decided to enter is one in which long-term relationships, cultural clues, and understanding and emotions are important in doing business. This country's approach would best be described as ________.
High-Context Culture
In a culture in which people value material possessions, money, and assertiveness, where would you place them and on what Hofstede dimension?
High (aggressive) on the Goal Orientation dimension
Your company wants to do business with both Taiwan and China, but you realize that the governments of these two countries do not get along and will not work well with each other. Which of the following countries could best help your company moderate these problems?
Hong Kong
Walmart is based in the United States. Walmart opens a store in Alberta, Canada. Which of the following best describes Canada's relationship with Walmart?
Host Country
You are an advisor helping to resolve a dispute between a French company and a German company. You determined the dispute should be resolved through litigation in France using French law. What question must still be answered before you can conclude that the dispute will be resolved fairly?
How can you be sure that both sides will abide by the agreement?
For much of the post World War II period, many South American countries followed which economic development policy?
Import substitution
Buying products made in other countries for use or resale in one's own country is known as which of the following?
Importing
Which of the following is one of the benefits to host countries of encouraging foreign direct investment (FDI)?
Increased technology transfer
Which country instituted market-opening reforms, which reduced trade barriers, opened the doors to increased FDI, and modernized the country's financial sector?
India
A multinational corporation wants to hire the most qualified worker for one of its branches in India, but it is concerned that her hiring will hurt morale because of her low social status. Which of the following is the basis of the corporation's concern?
Indian culture is highly stratified.
Jamal's company sells the rights to use its logo to a foreign company. This is an example of which of the following?
International Licensing
Jose's company agrees to operate facilities for a firm in another country for an agreed-upon fee. This is an example of which of the following?
International Management Contract
Which of the following is TRUE regarding international business expansion?
International business expansion has led to an expansion of business activity into new markets previously insulated from the international marketplace.
Which of the following describes a primary difference between international licensing and international franchising?
International licensing involves only intellectual property such as patents, trademarks, brand names, and copyrights; international franchising involves operating systems as well.
The firms in which country pioneered just-in-time inventory management techniques?
Japan
Which of the following BEST illustrates the difference between the Japanese negotiating style and the Latin American negotiating style?
Japanese negotiators are likely to make subtle power plays; Latin American negotiators are likely to exploit weaknesses.
Which of the following represents a major challenge to many African countries?
Leveraging the growth in their commodities sector to create broad-based economies.
Which of the following has allowed people to learn about other cultures firsthand?
Low airfares
Melanie works in the United States selling computer hardware to a company in Germany. This is known as which of the following?
Merchandise Export
Which of the following BEST describes the difference between merchandise import and service import?
Merchandise import involves purchasing tangible items from a foreign company; service import involves purchasing intangible products from a foreign company.
You are an oil executive considering expanding your operation into South American markets. However, you are concerned that governments throughout South America have recently begun nationalizing oil industries within their borders. The governments argue that oil is a natural resource that should benefit their own countries only, rather than foreign businesses, but have allowed all other industries to remain independent. This is an example of which type of risk?
Micropolitical risk
What subsidiary of the World Bank provides insurance against political risks?
Multilateral Investment Guarantee Agency (MIGA)
Stephanie works for a company that has branches in more than 50 countries. Her company can best be described as which of the following?
Multinational Corporation (MNC)
The _______________ was initiated in 1994 between Canada, the United States, and Mexico, which reduced barriers to trade among the three countries over a 15-year period.
North American Free Trade Agreement (NAFTA)
Which of the following acronyms stands for an agency that offers U.S. companies insurance against the political risk of foreign investments?
Office of Public Insurance Counsel (OPIC)
Which practice makes it difficult for a competitor to improve its own technology without infringing on the intellectual property of others?
Patent Flooding
Budi is the president of a medium-sized Indonesian company. During his workday, Budi concerns himself with strategy and pays little attention to daily operations. This is an example of which of the following?
Power-respecting orientation
Under whose elections and leadership did Russia's economy rebound at the beginning of the new century?
Putin
XYZ S.A., a Chilean subsidiary of a U.S. company operating in Chile, has been denied the right to send some of its profits back to its home office. What is this restriction called?
Repatriation
Of the following former Soviet bloc countries, which one did NOT restructure its economy from a centrally planned communist system to a decentralized market system and did NOT join the EU?
Russia
One country in which a lack of the rule of law appears to be affecting foreign direct investment (FDI) is ______________.
Russia
On the Fourth of July in the United States, almost all citizens have a cookout during the early evening and then attend a fireworks show. This is an example of what type of cultural behavior?
Shared
Which of the following countries has most closely tried to emulate the economic path taken by post-World War II Japan?
South Korea
Which of the following countries has relied on close cooperation between government and several large conglomerates (chaebol), which in some ways are similar to the Japanese keiretsu?
South Korea
Which Asian countries are known as the "Four Tigers"?
South Korea, Taiwan, Singapore, and Hong Kong
Laws enacted by legislative action are known as ___________________________.
Statutory law
Business people from which of the following countries are most likely to hide their emotions?
Taiwan
__________________ comprises 28 countries that are seeking to promote peace and prosperity by reducing mutual barriers to trade and investment.
The European Union (EU)
_________________________ resisted initiatives to broaden the EU's powers and, as a traditionally strong supporter of free trade, provided an important counterweight to French protectionist tendencies.
The United Kingdom (UK)
Chinese leaders are trying to identify the challenges that will be the hardest for China to face. Which of the following would you identify as a significant challenge for China to face?
The labor migration as rural workers leave to become factory workers.
What is meant by the term "lingua franca," which is used in international business?
The predominant language used in international business.
_________ means "that judges decide cases 'without respect to persons', that is, without considering the social status, attractiveness, etc. of the parties or of their lawyers."
The rule of law
Saudi Arabia's legal system is based largely on the teachings of the Koran. This type of government is known as which of the following?
Theocratic
Which of the following is NOT a reason that has compelled firms to become more global?
To improve the probability of being acquired
The principles and standards accepted by members of a society are known as which of the following?
Values
Which of Russia's leaders tried to privatize many of Russia's state-owned firms in an attempt to raise productivity, economic health, and performance?
Yeltsin
Firms can reduce the chances that they are sending the wrong message to their customers by using a technique known as ___________________.
backtranslation
When a foreign government seizes a foreign company's assets in their country but does not provide any compensation in return, it is called ________.
confiscation
A core competency is a(n) ________.
distinctive strength or advantage that is central to a firm's operations
A(n) ________________ is a comprehensive restriction against all commerce with a given country—it may be imposed by countries acting in unison or alone.
embargo
If a country attempts to control or regulate business activities outside of its borders, it is called ________.
extraterritoriality
Money sent out of a politically or economically unstable country to one perceived as a safe haven is known as ____________________.
flight capital
The purchase of all the common stock of the UK's Cadbury PLC by Kraft is an example of _____________________.
foreign direct investment
No area of the world has undergone as much economic change in the past two decades as the countries carved out of the __________________.
former Soviet Union
According to Geert Hofstede, a country culture that communicates that "the whole is more important than the parts," i.e., the organization is more important than the employees, would tend to have a ________.
high collectivist social orientation
International trade and investment declined throughout the 1930s as a result of _______________.
increased tariffs and quotas
The willingness of foreign firms to transfer technology to a country and an important determinant of a country's technology environment is the degree of protection that the country's laws offer to _________________.
intellectual property rights
When Denzel's firm authorizes a firm in a second country to use its patents, the firm is engaging in ________________________.
international licensing activities
In the United Kingdom, service exports and imports such as banking, travel, and accounting activities are known as ________ trade.
invisible trade
The U.S. dollar serves as ________ the currency in which the sale of goods and services is denominated.
invoicing currency
The type of risk that affects all firms in a country is known as ________.
macropolitical risk
Many South American countries suffer from huge income disparities and widespread poverty among their peoples. This has led to __________.
political instability and continual cries for reform