Chapter 1 - International Business
As stated in the text, an international business is:
A. a business whose activities involve crossing national borders.
The increased internationalization of business requires __________ to have a basic knowledge of international business.
A. all managers
According to supporters of the globalization of trade and investment, free trade:
A. creates more and better jobs.
The reasons international firms enter foreign markets are all linked to either (1) the desire to increase profits or (2) the desire to increase sales.
FALSE
The term international business is used to describe an organization with multicountry affiliates, each of which formulates its own business strategy based on perceived market differences.
FALSE
While international business as a discipline is relatively new, international business as a business practice is not.
TRUE
Which of the following are identified in the text as being drivers of globalization?
A. Technological
The level of service exports worldwide increased more than _______ between 1980 and 2010.
C. 10-fold
The worldwide stock of outward FDI is estimated to have increased _______ between 1990 and 2010.
C. 9-fold
_______ refers to the transportation of any domestic good or service to a destination outside a country or region.
C. Exporting
International business really began:
C. before the time of Christ.
According to the text, the tendency toward an international integration of goods, technology, information, labor, and capital, or the process of making this integration happen, is called:
C. economic globalization.
Historically, international business:
C. two of A, B, and D.
UNCTAD, an agency of the United Nations, estimates there are __________ international firms in the world.
D. 82,000
In organizing their international activities, there are five dimensions along which management can globalize or standardize these activities.
FALSE
A survey of CEOs of the 162 largest firms on Fortune's list of the 500 largest American corporations found that the internationally oriented courses that were viewed as being the most important for early career positions included topics related to:
D. all of the above.
According to opponents of the globalization of trade and investment:
D. all of the above.
If you already have a job, you can enhance your opportunities for international experience by:
D. all of the above.
A global company is:
D. an organization that attempts to standardize operations worldwide.
Environment as used in the textbook is the forces surrounding and influencing the life and development of the firm and is classified as:
E. A and C.
International business differs from domestic business in that a firm operating across borders must deal with what environmental forces?
E. Two of the above
The international business manager can choose to:
E. all of A, B, and C.
__________ was the world's leading manufacturing country for about 1,800 years, until it was replaced by Britain in about 1840.
E. none of the above.
According to the text, the reasons international firms enter foreign markets are linked to:
E. two of A, B and C.
A survey of CEOs of the 162 largest firms on Fortune's list of the 500 largest American corporations found that the CEOs strongly believed that:
E. two of A, B, and C.
According to the text, personnel working in a foreign subsidiary are working in the international environment:
E. two of A, B, and C.
According to the text, political drivers of globalization include:
E. two of A, B, and C.
According to the text, the dimensions along which management can globalize (standardize) their company's international activities include:
E. two of A, B, and C.
A company headquartered in another country is known as a foreign business.
FALSE
An international company is:
E. two of A, B, and C.
The domestic environment is composed of all the uncontrollable forces originating in the __________ that surround and influence the life and development of the firm.
C. home country
Decision making in the international environment is __________ it is in a purely domestic environment.
C. more complex than
Unconscious reference to one's own cultural values when judging behavioral actions of others in a new and different environment is called:
C. self-reference criterion.
Reasons for international firms to enter into foreign markets are linked to which of the following desires?
D. All of the above.
A multidomestic company is:
D. an organization with multicountry affiliates.
Examples of the kinds of uncontrollable forces listed in the text are:
D. two of the above.
Foreign environmental forces often operate differently than domestic environmental forces because:
D. two of the above.
The international environment is the interactions between:
D. two of the above.
A common cause of the added complexity of foreign environments is managers' unfamiliarity with other cultures and is called self-reference syndrome.
FALSE
A multidomestic company is an organization that attempts to standardize and integrate operations worldwide in all functional areas.
FALSE
According to the definitions in the text, a multidomestic firm is an organization that attempts to standardize operations worldwide in all functional areas.
FALSE
According to the text, environmental elements over which management does have some control—including competitive, labor, and financial forces—are called internal forces.
FALSE
According to the text, the international environment is all of the uncontrollable forces originating outside the home country that surround and influence the firm.
FALSE
According to the text, the self-absorption criterion is probably the biggest cause of international business blunders
FALSE
An examination of the 2009 Human Development Report shows that only 23 of the 182 countries for which data were available had average annual GDP per capita growth rates that were higher than the U.S. growth rate for the period 1990-2007.
FALSE
An international company is an organization with multicountry affiliates, each of which formulates its own business strategy based on perceived market differences.
FALSE
As the term is used in the text, foreign business is business whose activities are carried out across national borders.
FALSE
Britain was the world's leading manufacturing country for about 1,800 years, until it was replaced by the United States at the end of the 1800s.
FALSE
Critics of large global firms compare these firms' sales with nations' total sales to illustrate the tremendous size of these firms.
FALSE
Exporting refers to the transportation of any good or service to a destination inside a country or region.
FALSE
External environmental forces are commonly referred to as controllable.
FALSE
International business differs from domestic business in that a firm operating across borders must deal with the forces of two kinds of environments—domestic and foreign.
FALSE
Only those companies that have foreign operations need to be aware of what is occurring globally in foreign markets and their industry.
FALSE
Opponents of globalization argue that globalization has contributed to an improvement in environmental and health conditions.
FALSE
The United States has only about 10 percent of the world's population, so the vast proportion of most companies' potential customers are located elsewhere.
FALSE
The forces in the international environment are the same as those in the domestic environment except that they occur in foreign nations.
FALSE
The international environment is composed of all the uncontrollable forces that surround and influence the firm's life and development.
FALSE
Transnational corporations account for approximately 25 percent of total global output and nearly 50 percent of world trade.
FALSE
Uncontrollable forces are external forces over which management cannot exert any influence.
FALSE
A business whose activities are carried out across national borders is known as an international business.
TRUE
The major globalization drivers include all of the following except:
B. cultural.
Foreign business denotes:
B. the domestic operations within a foreign country.
The kinds of forces in the foreign environment are __________ those in the domestic environment except that they occur in foreign nations.
B. the same as
Foreign subsidiaries must obey the local laws. If they don't, according to the text they are subject to:
B. two of A, C, and D.
A global company is an organization that attempts to standardize and integrate operations worldwide in most or all functional areas.
TRUE
According to the text, the domestic environment is all of the uncontrollable forces originating in the home country that surround and influence the firm's life and development.
TRUE
According to the text, the level of intracompany trade of multinationals in 1930, as a percentage of world trade, may have exceeded the proportion at the end of the 20th century.
TRUE
All managers need to have a basic knowledge of international business.
TRUE
Changing the method of going abroad from exporting to overseas production is often necessary to protect foreign markets.
TRUE
Expanded international trade is linked with the creation of more and better jobs.
TRUE
External forces in the international business environment are commonly called uncontrollable forces.
TRUE
Foreign business refers to the operations of a company outside its home or domestic market
TRUE
Globalization has produced uneven results across nations and people.
TRUE
Greater profits may be obtained by either increasing total revenue or decreasing the cost of goods sold.
TRUE
Importing refers to the transportation of any good or service to a destination into a country or region, from a foreign origination point.
TRUE
Internal environmental forces are commonly referred to as controllable.
TRUE
One variable commonly used to measure where and how fast internationalization takes place is the increase in total foreign direct investment.
TRUE
Opponents of free trade point out that globalization has contributed to a decline in environmental and health conditions.
TRUE
Supporters of globalization generally argue that it is the best strategy for advancing the world's economic development.
TRUE
That free trade is the best strategy for advancing the world's economic development is one of the few propositions on which almost all economists agree.
TRUE
The Ottoman Empire's powerful location raised the cost of Asian trade for the Europeans and resulted in a search for sea routes to Asia.
TRUE
The United Nations uses the term transnational to describe an enterprise doing business in more than one country.
TRUE
The tendency toward an international integration of goods, technology, information, labor, and capital, or the process of making this integration happen, is referred to as economic globalization.
TRUE
The term international company refers to both global and multidomestic companies
TRUE
The world stock of outward foreign direct investment was $19 trillion at the beginning of 2010, which was more than nine times what it was in 1990.
TRUE
There are five major kinds of globalization drivers, all based on changes that are leading international firms to the globalization of their operations.
TRUE
There are many outstanding international career opportunities for people with desirable interpersonal and language skills that are not in mainstream business but may require basic business expertise.
TRUE
Due to the expanding importance of foreign-owned firms in local economies, host governments have made their policies toward these companies:
B. more liberal.
The major globalization drivers include all of the following except:
B. social.
Environmental forces can be classified as:
A. all of B, C, and D.
International business differs from domestic business in that a firm operating across borders must deal with:
A. all of C, D, and E.
Firms that have substantial operations in more than one country are called:
E. two of A, B, and C.
Management has no direct control over the external environment of the firm but can exert influence by:
E. two of A, B, and C.
Opponents of globalization argue that globalization has produced:
E. two of A, B, and C.
The forces over which management does have some command are called:
E. two of the above.