Chapter 7 LearnSmartAssignment MKTG 3050

Match each of the following global market-entry strategies with the correct definition. 1. Exporting 2. Licensing 3. Joint venture 4. Direct investment

1. Exporting-Producing products in one country and selling them in another. 2. Licensing-Offering the right to a trademark, patent, trade secret, or other intellectual property for a fee. 3. Joint venture-Investing together with a local firm to create a local business that shares control and profits. 4. Direct investment-Investing in and owning a foreign subsidiary or division.

Global ______________ among firms exists when they originate, produce, and market their products worldwide.

Blank 1: competition

Tariffs and quotas are the tools of ______________ , used by governments to shield local industries from foreign competition (one word).

Blank 1: protectionism

Match the types of companies that operate in the global marketplace with their correct definition. 1. International firm 2. multinational firm 3. transnational firm.

1. The international firm => Engages in trade and marketing in different countries as an extension of the marketing strategy in its own country. 2. The multinational firm => Views the world as consisting of unique parts and markets to each part differently. 3. The transnational firm => Views the world as one market and emphasizes cultural similarities or universal consumer needs more than differences.

Direct investment requires a firm to maintain ______ ownership of its facilities, offices, and plants in a foreign country.

100%

Pricing in the global marketplace is a difficult task for which two reasons?

Issues like tariffs and anti-dumping laws might exist. Many countries have rules governing the competitive marketplace.

When a German company decides to build a new hotel in Manhattan and the design calls for the 13th floor to be renamed the 14th floor, what is the firm considering?

It is acknowledging a cultural symbolism about the number 13.

Which of the following are reasons marketers consider cross-cultural analysis as important? (Check all that apply.)

It tells marketers what customs are considered normal and expected. It tells marketers what a society values. It tells marketers what is represented by symbols.

________ lifted many trade barriers between Canada, Mexico, and the United States and created a marketplace with more than 475 million consumers.

NAFTA

Which two are examples of trade agreements signed by several countries to lift many trade barriers between them? Multiple select question. ATT WTO NAFTA The EU

NAFTA The EU

What are the important trade groups or agreements that promote free trade? (Select all that apply) Multiple select question. NAFTA The EU GDP EEOC

NAFTA The EU

NAFTA stands for ______.

North American Free Trade Agreement

What is considered normal and expected about the way people do things in a specific country is known as ______.

a custom

The higher a country's purchasing power, the more likely it is to also have ______.

a large proportion of middle-income households

A quota is ______. Multiple choice question. a government tax on goods or services entering a country a restriction on a firm's ability to export its products, guaranteeing local availability a restriction placed on the amount of a product allowed to enter or leave a country government legislation to encourage free trade

a restriction placed on the amount of a product allowed to enter or leave a country

A personally or socially preferable mode of conduct or state of existence that tends to persist over time is called ______.

a societal value

What two elements are used in a trade war? Multiple select question. a boycott a tariff an embargo a quota a bribe

a tariff a quota

A product ______ strategy is being used when a firm changes a product in some way to make it more appropriate for consumer preferences in another country.

adaptation

When Wrigley's offers its gum in grapefruit, cucumber, and tea-flavors in China, it is an example of a product ______ strategy.

adaptation

Gross domestic product is the monetary value of ______. Multiple choice question. all products and services produced in a country during one year all exports of goods and services to other countries during one year the difference between a nation's exports and imports all of a country's real estate, both improved and unimproved

all products and services produced in a country during one year

In the past decade, the dollar value of world trade has ______. Multiple choice question. sharply declined remained steady only marginally increased almost doubled

almost double

In the past decade, the dollar value of world trade has ______. Multiple choice question. remained steady sharply declined almost doubled only marginally increased

almost doubled

Global marketers sometimes have problems translating promotional material into the foreign country's language, leading to miscommunication issues. The best way to avoid problems in translation is to use ______.

back translation

The Foreign Corrupt Practices Act makes it a crime for U.S. corporations to ______.

bribe a foreign government official

In what two ways do governments implement protectionism measures? Multiple select question. by imposing tariffs by setting quotas by setting prices by reducing foreign investment

by imposing tariffs by setting quotas

What are the three primary ways a product can be sold globally?

Product extension, product adaptation, and product invention

The EU has simplified the way multinational companies market their products in which two ways?

Products and packaging can be more uniform for distribution across Europe. There are fewer regulatory restrictions on transportation.

Which legislation makes the theft of trade secrets by foreign entities a federal crime in the United States?

The Economic Espionage Act

Which two statements are true of the WTO? Multiple select question. The WTO is still small, representing countries responsible for less than 1/4 of all world trade. The WTO issues non-binding decisions. The WTO decides trade disputes between members. The WTO is an established permanent institution rather than being simply an agreement.

The WTO decides trade disputes between members. The WTO is an established permanent institution rather than being simply an agreement.

Under which of the following conditions do the political-regulatory climate in a country would become unappealing to global companies? (Check all that apply.)

There had been several acts of terrorism in urban areas. There are quite a few rules associated with selling products in the country.

In which of the following ways do successful global marketers handle their firm's global marketing programs?

They will standardize them whenever possible.

What two situations likely exist in developing countries that cause marketers to adapt their global distribution strategies?

Transportation and communication systems are underdeveloped. Traditional channels that have been used do not exist.

Which country is the top importer globally? Multiple choice question. Germany Japan China United States

United States

Which country is the top importer globally? Multiple choice question. Japan China United States Germany

United States

A trade war is a situation in which _______.

countries try to damage each other's trade by imposing tariffs and quotas

The main factors analyzed in a(n) ________ are values, customs, cultural symbols, and language.

cross-cultural analysis

Semiotics is a field of study dealing with ______.

cultural symbols and their meaning

The fact that in Japan women give men chocolates for Valentine's day is an example of how ______ can influence behavior in different societies.

customs

Assessing the political and regulatory climate for marketing in a country or region of the world involves not only identifying the current climate but also ______.

determining how long a favorable or unfavorable climate will last

Global marketers may devise creative solutions for getting their products to hard-to-reach consumers in developing countries. This type of solution is part of the firm's ______ strategy.

distribution

The clandestine collection of trade secrets or proprietary information about competitors is known as ______.

economic espionage

A country's communications, transportation, financial, and distribution systems together are known as its ______.

economic infrastructure

Consumer ________ is the tendency to believe that it is inappropriate or even immoral to purchase foreign-made products.

ethnocentrism

The global market-entry strategy in which products are produced in one country and sold in another is called ___________________

exporting

Coca-Cola uses a product ________ strategy when it sells virtually the same product in other countries.

extension

The EU, NAFTA, and similar agreements in Asia promote ______. Multiple choice question. economic isolation from other nations free trade among member nations immigration control within domestic borders protectionism for its people

free trade among member nations

A __________________ brand has the same product formulation, delivers the same benefits to consumers, and uses consistent advertising across multiple countries and cultures.

global

A brand that is marketed under the same name in multiple countries with similar and centrally coordinated marketing programs is known as a(n) ________ brand.

global

McDonald's is a(n) ________ brand; while its French fries and Ronald McDonald are standardized worldwide, some of its menu items vary to suit local tastes.

global

When Dunkin Donuts makes the same donut but uses flavors according to local preferences such as a chocolate donut rolled in vanilla creme and Parmesan cheese sold in India and a dry pork and seaweed donut sold in China, it is an example of a(n) _____ marketing strategy.

global

When a firm either produces or markets its products worldwide it is participating in what is known as ______.

global competition

Technology allows people to connect from distant parts of the world, allowing the growth of ______.

global markets

Even though in some countries per capita income is very low, marketers should realize that ________ might allow consumers to purchase their products.

government subsidies

A firm selling televisions knows from marketing research that when consumers in developing countries reach on average a yearly income equivalent to $1,000 they are more likely to purchase one of their televisions. Such a low income is sometimes enough because ______.

governments in developing countries often subsidize necessities, leaving money for other items

The acronym GDP stands for ______. Multiple choice question. global domestic pricing gross domestic product global distribution product gross distribution pricing

gross domestic product

For the global marketer, consumer ethnocentrism is important to understand because ______.

imported products can be rejected by local consumers on that basis alone

Global expansion often begins with exporting. Using a local intermediary to distribute the exported goods is known as ______.

indirect exporting

In China, where outside of major cities there are many unnavigable roads, foreign companies have to adapt their distribution strategies. Thus, before entering such a market, a firm must investigate the economic ______.

infrastructure

A(n) ______________venture is a global market-entry strategy that creates a partnership between a local and a foreign firm that will share ownership, control, and profits from the new company. (one word)

joint

A local firm and the foreign firm investing together to create a local business is called a(n) ______.

joint venture

Indirect exporting is an entry strategy that involves the ______ financial risk and allows a(n) ______ return to the firm.

least; limited

A firm can choose a global market entry strategy from among four choices: exporting, ______, joint venture, and direct investment.

licensing

General Mills has a(n) ________ arrangement with French cooperative Sodima to produce and sell its Yoplait yogurt in the United States.

licensing

When a company offers the right to a trademark, patent, trade secret, or other intellectual property in return for a royalty or a fee, it is known as a(n) ________ arrangement.

licensing

The EU, in essence, ______ trade barriers for its member countries when it became an economic union.

lowered

Why do nations enter into trade agreements? (Select all that apply) Multiple select question. to reach early adopters manage and promote trade activities between member nations to enhance their individual economies to increase the diffusion of innovation

manage and promote trade activities between member nations to enhance their individual economies

Which industry accounts for about 80 percent of world trade? Multiple choice question. telecommunications and transportation services education and tourism services insurance and banking products manufactured goods and commodities

manufactured goods and commodities

When Lever Europe markets its Snuggle fabric softener under seven brand names in 10 European countries, and varies its packaging, advertising, and even its formula in those markets, it is using a(n) ________ marketing strategy.

multidomestic

What two trends in the past decade have significantly influenced global marketing? Multiple select question. presence of a networked global marketspace the near elimination of economic espionage economic integration among countries reduced number of companies operating on a global scale

presence of a networked global marketspace economic integration among countries

Germany did not allow Walmart to sell some items below cost, an example of how a foreign government can constrain _________, which here made it impossible for Walmart to compete with local discount stores.

pricing strategy

What is not one of the three ways a product may be sold globally?

product diversification

A tariff is a government tax on ______. Multiple choice question. personal income generated in a foreign country products produced in a country prior to their export both imports and exports of products when the origin or destination of them is a foreign country products entering a country to raise their prices

products entering a country to raise their prices

A country's income distribution offers a reliable picture of that country's ______.

purchasing power

Direct investment exposes a firm to ______ risk. Multiple choice question. very little

significant

A global environmental scan, marketing research, and judgments based on experience will determine the extent of ________ that global marketing programs will have.

standardization or customization

Different cultures attach different meanings to things; a cultural ______ is anything that represents ideas and concepts of a specific culture.

symbol

The "thumbs up" sign is considered to be offensive in Russia when the palm of the hand is shown, so this ________ should be altered to show the back of the hand in advertising there.

symbol

A(n) ______ is a tax levied on a good imported into a country. Multiple choice question. boycott tariff embargo quota

tariff

Changes in which of the following has been the driving force for growth in global markets?

technology

When the European countries signed a trade agreement creating a free trading zone between the countries, they formed a transnational trading group called ______. Multiple choice question. NAFTA the EU the UK the Geneva convention

the EU

Product extension works best when ______.

the consumer abroad exhibits similar needs and uses for the product compared to domestic consumers

Currencies fluctuate against each other every day. The price of one's country's currency expressed in terms of another country's is called ______.

the currency exchange rate

When people from the United States travel to countries in Europe, they might check to see how the U.S. dollar compares to the euro. In doing so, they are checking ______.

the currency exchange rate

One important trend of the past decade on global marketing is ______. Multiple choice question. stiffer penalties that have eliminated economic espionage a decline in protectionism by individual countries the growth of global competition and global consumers the reduction in the use of technology to facilitate transactions

the growth of global competition and global consumers

The primary difference between indirect and direct exporting is that the former involves ________ while the latter does not.

the use of intermediaries

For what reason was the WTO initially formed? Multiple choice question. to place limits on the number and type of tariffs that can be issued to address an array of world trade issues to set currency exchange rates among nations to regulate the formation of trade agreements among nations

to address an array of world trade issues

Back translation can be defined as ______.

translating material back to its original language using a new interpreter to check if it retains its meaning

While a(n) ________ firm views the world as one market and emphasizes cultural similarities across countries rather than differences, a(n) ________ firm views the world as consisting of unique parts and markets to each part differently.

transnational; multinational

An example of a societal ______________ is Germans' lack of interest in using credit cards like Visa and MasterCard, perhaps in part because the German word for 'debt' is the same as the word 'guilt'.

values

An import quota seeks to guarantee that domestic industries ______. Multiple choice question. will retain a certain percentage of their domestic market will have maximum access to international free trade will pay lower taxes than their foreign counterparts will have access to experts who can decide international trade disputes

will retain a certain percentage of their domestic market

What three countries are part of NAFTA?

Canada Mexico United States

The most recent example of a trade war is the dispute between the United States and ______. Multiple choice question. Mexico China Japan Canada

China

Which country is the top exporter globally? Multiple choice question. Japan China Germany United States

China

The EU promotes trade among countries in ______. Multiple choice question. Europe Asia North America the Americas

Europe

U.S. legislation known as the ________ makes it a crime for companies to bribe officials of a foreign government in order to obtain or retail business in another country.

Foreign Corrupt Practices Act