JACKIE EXAM #2

The programmed-management approach is a type of

"glocal" advertising strategy.

Companies seeking to expand internationally have essentially which of the following export option(s).

All of the above

Export functions include

All of the above

Strategic Alliances can take the form of which of the following?

All of the above

Which of the following are reasons that many firms engage in exporting?

All of the above

Which of the following factors encourage standardization?

All of the above

Which of the following is (are) entry barriers?

All of the above

Which of the following is / are motive(s) for Strategic Alliances?

All of the above

The arithmetic average of the current exchange rate and the exchange rates in the two preceding years, adjusted by the ratio of domestic inflation to the combined inflation rates of the euro zone, Japan, the United Kingdom, and the United States, is known as the

Atlas conversion factor.

For those of you that came to class on Nov. 18: The capital of Guinea-Bissau is

Bissau

Which countries are considered to be emerging nations?

China, Turkey, and South Africa

What does CIF in international trade stand for?

Cost, Insurance, Freight

An example of expropriation without compensation is when

Cuba confiscated property during the Cuban revolution of the 1950s.

During the pretrial period, a law firm worked to find facts relevant to the litigation. What is this process called?

DISCOVERY

A business is practicing vertical integration when it receives inputs for its production processes from outside sources.

FALSE

A company wanted to evade a quota imposed on imports, so it shipped its finished goods to a country that didn't have a quota, and then relabeled them and shipped them to the quota-imposing country. This process is called intermediate shipping.

FALSE

A letter of credit is arranged by the seller.

FALSE

All nations in the world must recognize decrees and judgments from other nations.

FALSE

Arbitration tends to be less private than litigation.

FALSE

Economists believe that using trade restrictions for national defense is an effective way of protecting certain industries that are important to national defense.

FALSE

Exporting companies should always quote their prices as FOB rates.

FALSE

Fair competition is a strong rationale for import duties.

FALSE

GDP is the preferred measurement for assessing economic development.

FALSE

Human Capital" and "Relational Capital" are considered "knowledge assets" and provide an absolute advantage to an organization

FALSE

Romaine's company sent her and 3 other executives from her company to Thailand to assess business opportunities there. The Thai government publicized the visit and arranged for them to meet with various groups. This is called a field trip.

FALSE

Sanctions are a trade restriction that is effective in forcing change in a foreign country.

FALSE

The United Kingdom Bribery Act only penalizes a company for the act of bribery when it has been committed in the U.K.

FALSE

When a government allows the repatriation of earnings, it is considered an entry barrier.

FALSE

Which factor is crucial for a firm interested in global expansion and control?

Foreign Direct Investment (FDI)

What was the immediate impact of Russia's warning regarding ships sailing around Ukrainian ports?

Global grain prices rose sharply.

Which of these countries follows common law?

Hong Kong

The government of a country may decide it wants to extract more money from a business, particularly if the government believes the company is concealing profits. What measure might it take to achieve this?

It could nationalize the business

How did the Jamaica Agreement affect IMF members?

It established the rules for the floating exchange rate system.

What is the role of the home country in risk assessment?

It is a significant consideration.

What is a disadvantage of top-down planning?

It restricts initiative at lower levels of the organization.

What is the main role of an agent in the market country?

Legal representative

When barriers are high, alternative modes of entry may have to be chosen. Which mode of entry best exemplify this statement?

License a local producer

Outsourcing means:

Moving either manufacturing or services offshore

Can the grain deal between Russia and Ukraine be revived easily?

No, because Russia considers it terminated.

Which of the following is not a characteristic of Strategic Alliance?

None of the above

When is the ban on domestic sales of Ukrainian grain in some European Union countries expected to end?

On September 15

What is a key advantage of licensing as an entry mode?

Quick profits

What is a major concern in joint ventures regarding technology transfer?

Risk of know-how dilution

If the Securities and Exchange Commission learns that a business might be involved in corruption, it will look at other businesses in the same industry to assess if they might also be involved. What is this process called?

SWEEPING

A broad statement that defines the purpose for a company's existence is the mission statement.

TRUE

Algeria was a prosperous country until the effects of military rule, poor economic policies, and a civil war in the 1990s devastated its economy. Now it is a haven for Al Qaeda. This illustrates the effect of an unstable government. Group starts

TRUE

Common law systems rely on precedent to render decisions.

TRUE

Direct exporting involves transportation to the border and clearing through customs.

TRUE

Generally, industrial products require less adaptation than consumer products to meet the demands of the world market. Group starts

TRUE

If all countries had strong, freely convertible currencies, there probably wouldn't be a need for international countertrade.

TRUE

In BOP accounting, a deficit in the current account is always accompanied by a surplus in the capital account.

TRUE

In a control posture, acquiring a local firm is often the best strategy in emerging markets.

TRUE

Joint ventures often take the form of strategic alliances.

TRUE

Many managers have moved toward less-structured formats when doing strategic planning based on the ineffectiveness of five-year forecasts.

TRUE

One World and Star Alliance are examples of distribution alliances and non-Japanese Keiret-sus.

TRUE

Purchasing power parity is a means of adjusting the exchange rates for two currencies so the currencies have equivalent purchasing power.

TRUE

Sharia law and Halakha are both forms of religious laW.

TRUE

Since services are intangible, service quality is more difficult to quantify, allowing for more subjective view.

TRUE

Strategic alliances can include joint R&D and shared manufacturing.

TRUE

The International Monetary Fund is a source of economic data that analysts can access to assess economic conditions.

TRUE

The Paris Air Show is an example of a trade fair.

TRUE

The Sarbanes-Oxley Act (SOX) was created to increase ethical behavior by public company boards, their management, and their accounting firms.

TRUE

Unfair international competition for a company can be minimized by passing national laws.

TRUE

When the U.S. military contracts out security details in war zones, it is engaged in privatization.

TRUE

When using the term "Operational Code" it is understood as a law that is not written, but is enforced as though it were written.

TRUE

What does an 'Incremental' strategic posture in foreign entry imply?

Tentativeness and keeping future options open

How did Russia's attacks on Ukrainian ports affect the situation?

They destroyed grain waiting to be loaded onto ships.

What are Ukraine's alternatives for transporting its grain?

Using road, rail, and river routes

Civil law is based on

a collection of codes.

A fixed peg currency arrangement means that

a currency's exchange rates fluctuate around a fixed rate within a narrow band.

Sharone and her husband have developed a pizza pan that is guaranteed to keep the crust from sticking to the pan and washes clean with just water. They have applied to have exclusive rights to this product. What did they apply for?

a patent

International strategy can be described as

a plan that guides the way firms makes choices about developing and deploying resources.

A company shipped 50,000 units of a product to another country. The first 25,000 units entered the country duty-free, but a duty was charged on the next 50,000. This illustrates

a tariff-rate quota.

A manufacturing company pays import duties that are a stated percentage of the invoice value of the product. Which type of tariff does this company pay?

ad valorem

The U.S. government assigns specific amounts of sugar imports that can come from 40 nations. What type of quota does this represent?

allocated

One factor for relative changes in labor costs is increases or decreases in

compensation.

Jefferson Materials Corporation has developed a fire-resistant fabric that no one else has been able to replicate. It is used throughout the world in firefighting equipment and supplies. Since it is the only company making the product, customers are willing to pay a premium for the fabric. In this scenario, the fire-resistant fabric has helped the company develop a(n)

competitive advantage.

To be effective, a company's international strategy must be

consistent among all the functions and activities of the company.

Trade barriers create costs that are paid ultimately by the

consumer.

Soejin has written a cookbook. What form of legal protection can he obtain for his book?

copyright

In which type of currency arrangement would a currency be readjusted periodically at a fixed, preannounced rate?

crawling peg

In a certain European country, the domestic airlines receive preferential treatment over foreign airlines in terms of gate assignments and airport counter locations. Which NTB does this illustrate?

customs and other administrative procedures

The "Operational Code" is mostly found in

developing nations.

The amount of income left after paying taxes and making essential purchases is known as

discretionary income.

In Sharia law, interest is forbidden, which results in

equity partnerships, where business risk is shared.

A measure of the number of children born to a woman during her lifetime is the

fertility rate.

Governments may nationalize private firms in order to

follow an economic or political ideology.

The legal system of a country includes

governing principles, legislation and regulations.

In U.S. accounting law, the Sarbanes-Oxley Act

holds corporate officers personally responsible for their corporate filings.

A company was found guilty of price fixing, and even though it could not be proven that there was actual harm caused, the act was considered illegal per se. This means that the act was

illegal in and of itself.

When a company examines import data, what does it learn about basic need potential in a country?

immediate market potential at going price

The main goal of tariffs is to

increase the selling price of imported goods, thereby reducing competition for domestic producers.

In culturally dissimilar countries, if deep immediate market penetration is desired, what is usually the most successful strategy?

increased product modification

Which of the following is NOT a mode of entry?

indirect importing

When a country experiences a sustained increase in prices, it is feeling the effects of

inflation.

The ________blank environment includes the interactions between domestic and foreign environmental forces, or between sets of foreign environmental forces when an affiliate in one country does business with customers in another.

international

When Hilton Hotels provides management for foreign hotels that use the Hilton name and receives a fee for doing so, it is participating in which form of market entry?

management contract

Higher birthrates generally cause developing countries to have

more youthful populations than developed nations.

When a government transfers the assets of a company from the public sector to the private sector, it is an example of

privatization.

In the international marketing mix, branding is considered an element of ________ strategy.

product

Bath Babies Incorporated was held responsible in court for failing to indicate on its labels that its baby bath wash contained traces of mercury and could potentially harm infants. Which area of law is playing a part in this scenario?

product liability

As a way to decrease its tax rate, a company moved its profits out of the United States to a location with lower tax rates. What strategy is the company using?

profit shifting

Along with using tax benefits to decrease their tax rates, companies might also employ two basic strategies: tax inversion and

profit shifting.

Scenarios allow a business to

project possible outcomes of business decisions.

One reason a government chooses to restrict trade would be to

protect domestic infant industries.

A settlement awarded $2 million to each of the four hundred individuals harmed by the effects of groundwater emissions created by manufacturing processes at Standard Corporation The award money is an example of

punitive damages.

A company can use the inflation rate to determine the

real cost of borrowing in capital markets.

Multiple, plausible stories that managers consider for what might happen in the future are known as

scenarios.

A company relies on an exchange rate that is based on trade for delivery within two business days. What type of exchange rate does the company use?

spot rate

An example of retaliatory trade restrictions is

the U.S. response to the EU ban of hormone-treated beef.

The balance part of the BOP is explained by

the accounts being double-entry, so they are always balanced.

The time horizon of a strategic plan will vary according to

the age of the firm and the stability of its market.

The rural-to-urban shift is a reflection of

the movement of the population in search of jobs and conveniences.

What is the goal of value chain analysis?

to enable managers to identify which set of activities it will do itself and which it will outsource

Keene's favorite restaurant sells sandwiches that have a "kicker sauce." Everyone loves the sauce, but the company won't reveal what's in it. This sauce is an example of a

trade secret.

Potential losses or gains when financial statements are converted from one currency to another are known as:

transaction risk

When the law of one price is applied to interest rates, it suggests that

varying interest rates take into account anticipated differences in inflation levels.

Jalala works for a diamond importer. The company uses the U.S. dollar for international trade deals. In this instance, the U.S. dollar is acting as a(n)

vehicle currency.

In Japan, antitrust legislation

was introduced by the United States and did not harmonize well with Japanese values.

Reductions in birthrates are occurring worldwide because

women are gaining an enhanced status.