IB Final
Which of the following is an example of an ad valorem tariff? $.20 per unit of equipment sold $5 per unit of equipment sold $.20 per kilogram of fish sold 20% per kilogram of textiles sold
20% per kilogram of textiles sold
According to the Manpower Groups 2016 annual survey how frequently are employers unable to find people with the right skills? 5 percent of the time 25 percent of the time 40 percent of the time 2 percent of the time
40 percent of the time
About what percentage of the world's population has access to the internet? 10 percent 45 percent 25 percent 95 percent
45 percent
At what point does a copyright expire in the United States? 70 years after the death of the author 7 years after obtaining the copyright Upon the death of the author Never
70 years after the death of the author
About what percentage of the world's population is covered by a cellular network? 25 percent 10 percent 45 percent 95 percent
95 percent
Which of the following is the best definition of a government quota? A direct limit on the amount of goods that can be imported to or exported from a country A minimal amount of goods to be produced in a certain industry A minimal amount of goods that must be imported to or exported from a country A minimal amount of goods to be produced by a certain company
A direct limit on the amount of goods that can be imported to or exported from a country
Håkan Lans is one of Sweden's most famous inventors. He developed a GPS system that sends information to aircraft allowing pilots to know what other aircraft are in the surrounding area and avoid collisions. Which of the following protections would help Håkan protect his invention in global markets? A copyright A trademark A patent A trade secret
A patent
Gucci, part of the French company Kering, is a global maker of luxury fashion and leather goods including its famous GG Supreme tote. Which of the following protections would help Gucci protect its intellectual property (its design) in global markets? A trade secret A patent A copyright A trademark
A trademark
M-Pesa has changed the lives of many Kenyans by enabling all but the following: Allowing them to deposit money in a secure location Allowing them to make receive government assistance Allowing them to transfer money electronically Allowing them to gain access to credit for the first time
Allowing them to gain access to credit for the first time
M-Pesa has changed the lives of many Kenyans by enabling all but the following: Allowing them to make receive government assistance Allowing them to deposit money in a secure location Allowing them to transfer money electronically Allowing them to gain access to credit for the first time
Allowing them to gain access to credit for the first time
A company in Germany has just developed proprietary technology that allows it to correctly predict when a person is likely to have a stroke. The company has a 6-month lead time over competitors after which they are likely to have direct competition in global markets. Which entry tactic would you suggest the company use when entering the U.S. market. Buy Ally Make A combination
Ally
Hyundai sell its award winning Genesis luxury car for about $10,000 more in Korea than in other markets. What might explain this price premium? An ethnocentrism bias The export costs are higher in Korea The government supports Hyundai with tax breaks Gas is more expensive in Korea
An ethnocentrism bias
Henry Ford combined ideas, insight and products from others to efficiently build automobiles. This is an example of: An innovation A strategic goal An R&D expense An invention
An innovation
According to the most-favored-nation-clause, which of the following is true? Any agreement reached between member parties of the World Trade Organization extends to all other members. The most-favored-nation has the power to limit agreements between member parties of the World Trade Organization Any member party of the World Trade Organization has the ability to create non-biased agreements between other member parties. Agreements between member parties of the World Trade Organization are limited to those accepted by the majority of members.
Any agreement reached between member parties of the World Trade Organization extends to all other members.
Physical infrastructure includes all but which of the following? Manufacturing equipment Energy resources Building codes Access to raw materials
Building codes
Which of the following in not an implication of China's two-tiered pricing strategy for rare earth materials? China has monopoly negotiation power with other countries. Japan and other countries are investing heavily in alternative materials. Chinas currency is likely to depreciate. Chinese producers of electronics are likely to have lower input costs.
Chinas currency is likely to depreciate.
China primarily relies on what form of energy: Natural gas Nuclear Solar Coal Diesel
Coal
The innovation life cycle involves all but which of the following steps? Reaching out Going local Codifying outcomes Uncovering principles
Codifying outcomes
Which of the following is the best description of the theory of overlapping demand? Countries should trade with countries whose demands do not overlap, because they will likely be able to provide the necessary resources. Countries whose residents have similar financial position, and therefore similar demand, should trade with each other. Countries of all statuses should trade with each other, because overlapping demands do not decrease the profitability of trade. Countries with similar socioeconomic status have similar demands, therefore the countries who supply those resources have the most trading power.
Countries whose residents have similar financial position, and therefore similar demand, should trade with each other.
The country of Estonia increased its annual labor pool by 7 million workdays by: Allowing an influx of immigrants from Syria Partnering with it neighbor Russia in manufacturing systems Banning auditor and tax consultants Creating an online platform for government services
Creating an online platform for government services
What should global companies focus on? (select all that apply) Consolidating value Creating value Capturing value Coordinating value
Creating value Capturing value
Economic distance increases by: Different religions Different natural resources Different climates Different currency
Different natural resources
Cultural distance increases by all of the following except: Different politics Different norms Different languages Different values
Different politics
One of the biggest challenges for global firms seeking to protect their intellectual assets is that: Global courts are slow Enforcement is only had through courts in Geneva Each country requires filing for protection Governments don't want companies to obtain legal protection
Each country requires filing for protection
A company stationed in Germany designed a new piece of technology and began to mass produce and export it to many countries with varying economies. This is an illustration of which of the following theories of trade? Economies of Scale Overlapping Demand International Product Life Cycle Comparative advantage
Economies of Scale
Imagine that Google wants to create expertise in producing and selling AAA batteries to global markets. Which entry mode would be most appropriate? Exporting Wholly owned subsidiary Franchising Turnkey
Exporting
lease list the following entry modes in order of required investment.Wholly Owned SubsidiaryExportingJoint VenturesFranchising Exporting, Franchising, Joint Ventures, Wholly Owned Subsidiary Franchising, Joint Ventures, Exporting, Wholly Owned Subsidiary Wholly Owned Subsidiary, Joint Ventures, Exporting, Franchising Joint Ventures, Exporting, Wholly Owned Subsidiary, Franchising
Exporting, Franchising, Joint Ventures, Wholly Owned Subsidiary
The disadvantages of export as a mode of entry include all of the following except: Exports may face tariffs Exports face transportation costs Exports may be produced in countries with higher relative costs Exports are slower than other forms of entry
Exports are slower than other forms of entry
The benefits of setting stretch goals are that it helps a company to do all but which of the following? Look for new ways of solving problems Reduce complacency Focus resources and investments Do things that are unexpected
Focus resources and investments
Which of the following is not a factor in Porter's diamond? Factor endowments Demand conditions Related industries Government intervention
Government intervention
Which of the following activities is not part of the primary activities in the value chain of a firm? Research and Development Distribution Human Resources Customer Service
Human Resources
A meganational firm is likely to have what type of information sharing? Information from local markets to local markets Information from local markets to headquarters Information from headquarters to local markets Information from national markets to local markets
Information from headquarters to local markets
Which of the following is not an effect of global trade being generally processed in USD? It pulls capital out of the US market. It increases the cost of domestic goods and services. It increases the rate of domestic unemployment. It decreases US debt.
It decreases US debt.
All but which of the following is true of a nation's capital account? It measures the transfer of capital to or from other countries It indicates whether a country is producing more than it consumes A trade deficit leads to a loss of capital Capital includes monetary investments
It indicates whether a country is producing more than it consumes
R&D around the world is experiencing which of the following trends? It is increasing in every market. It is increasing in mature markets but decreasing in emerging markets. It is increasing in China and Japan but decreasing in the U.S. It is decreasing in mature markets but increasing in emerging markets like India.
It is increasing in every market.
Which of the following elements does not contribute to a company's culture? Its language Its beliefs Its values Its leadership
Its leadership
The goal of international strategy is to ________. Know how to manage differences to create competitive advantage Let subsidiaries run their own initiatives Help companies know how to go global Make money for the company
Know how to manage differences to create competitive advantage
Donald Trump, the U.S. president, has established a global real estate brand with properties in India, Korea and Turkey among other markets. Imagine Mr. Trump wants to enter the Egyptian market at the lowest possible cost, what entry strategy should he use? Licensing Turnkey Wholly owned subsidiary International joint venture
Licensing
If Nike designs shoes in Oregon, sources raw materials from Thailand, manufactures shoes in Malaysia, creates adverting in France, and sells shoes globally the company is engaged in which strategy? Meganational Transnational Multidomestic Differentiation
Meganational
Which of the following is the best example of comparative advantage? Meissen, Germany produces porcelain better than they manufacture vehicles. A country with more textiles has a comparative advantage over a country with more wine. France has multiple absolute advantages over England. A coastal country is much more efficient in sea-food production than a land-bound country.
Meissen, Germany produces porcelain better than they manufacture vehicles.
Cemex is the world's largest cement company. Because the raw materials, structural requirements and building standards are different in each country it requires each market to customize products for the local market. The company is pursuing which strategy? Transnational Meganational Multidomestic Low cost
Multidomestic
E&Y is a global provider of tax and business consulting. What strategy would be most appropriate for the firm to consider as it operates in global markets? Low cost Transnational Meganational Multidomestic
Multidomestic
Which of the following trends in air transport is true: Passenger loads and air freight are increasing. Passenger loads are increasing while air freight is decreasing. Passenger loads and air freight are decreasing. Passenger loads are decreasing while air freight is increasing.
Passenger loads and air freight are increasing.
The Sky Team is a relationship between several major airlines such as Delta, Air France and Korean Air. This alliance allows the airlines to increase sales by? Lowering legal hurdles Locking out other airlines Sharing costs Pooling their resources
Pooling their resources
Which of the following in not a type of innovation? Efficiency enhancing Market creating Performance improving Process integrating
Process integrating
Which of the following would you NOT expect to happen in the maturity phase of the international product life-cycle? Global sales decline. Per-unit cost of production declines. Production from the innovating company declines. Production in developing countries declines.
Production in developing countries declines.
Which two types of R&D do global firms conduct? R&D focused on developing new and repurposing old technologies R&D focused on application and advancement R&D focused on government and customer segments R&D focused on pure science and on patents
R&D focused on developing new and repurposing old technologies
Establishing a wholly owned subsidiary in a foreign market allows a company to do all but which of the following? Have full control of operations Retain its knowledge Reduce its political risk Learn directly from customers
Reduce its political risk
When companies invest in innovation, on average the largest portion of that investment is used to fund? Access to consumer behavioral data New scientific equipment Information technology Salaries
Salaries
Which of the following is not a factor in helping International businesses better assess the technology level of a country? Social infrastructure Physical infrastructure Digital infrastructure Human infrastructure
Social infrastructure
Denmark has just begun producing a product that is already being produced in many foreign markets. According to the Infant Industry Theory, which of the following measures should be taken? Tariffs should be placed on the importation of the product. The exportation of the product should be expedited. The industry should move to a country with a comparative advantage. The exportation of the product should be heavily taxed until the industry is more advanced.
Tariffs should be placed on the importation of the product.
Comparative advantage is: The ability to trade a good or service at a lower cost than a rival. The ability to produce a specific good or service better than a rival. The ability to produce a specific good or service at a lower opportunity cost than a rival. The ability to trade for a good or service that the country cannot produce.
The ability to produce a specific good or service at a lower opportunity cost than a rival.
A certain country had a positive balance of payments, even though they had a slight current account deficit due to buying goods on credit. Which of the following is a possible explanation? The country's trade surplus was greater than the credit they incurred. It is not possible to have a positive balance of payments and a current account deficit. A current account deficit is not related to the balance of payments. The country produced more goods than they consumed.
The country's trade surplus was greater than the credit they incurred.
When three regions in India introduced cellular phones to fishing villages, what happened to the price of fish at the daily fish market? The price of fish decreased because the fish sellers knew the market price. Supply of fish increased. The difference between the low and high price decreased. The price of fish increased because the fishermen knew the market price.
The difference between the low and high price decreased.
If Amazon enters the Japanese online market by translating its U.S. website into Japanese the company is using which internationalization strategy? The Transnational The incremental The multidomestic The meganational
The meganational
According to some, the most important invention in global transportation in the last two decades is: The standardized shipping container Large capacity ships The creation of shorter shipping routes Solar powered ships
The standardized shipping container
Honda motorcycles decided to build a plant in Brazil that can produce 10 times the current demand of motorcycles. Why would the company do this? To offer a faster motorcycle To signal the importance of Brazil To allow for localization of different geographic markets To achieve economies of scale
To achieve economies of scale
Domestic businesses expand to international markets for all but the following reasons? To grow sales To acquire resources To reduce risk To expand product lines
To expand product lines
Which of the following statements is false? Trade flows usually evolve from rich-country exports to rich-country imports. Rivalry often aids the growth of world-class companies. Comparative advantages often depend on location of production. Trading is usually only beneficial to both parties if they each have a separate absolute advantage.
Trading is usually only beneficial to both parties if they each have a separate absolute advantage.
Which of the following is a bilateral trade agreement? The North American Free Trade Agreement US-Columbia Free Trade Agreement Trans-Pacific Partnership The trans-Pacific Partnership
US-Columbia Free Trade Agreement
Which country spends the most per student on post-secondary education (education after high school)? United States of America England Switzerland Sweden
United States of America
Global manufacturing clusters can improve firm performance by all but the following: Weakening government regulation Attracting talent and investors Facilitating knowledge sharing among firms Increasing supplier concentration
Weakening government regulation
Multinational companies often locate their R&D centers based on two criteria. These are: Where top scholars are trained and where labs are located Where tax incentives and laws are favorable Where the need for information collection and processing is greatest Where they can access cheap labor and government support
Where the need for information collection and processing is greatest
Companies such as Microsoft and Cisco recognize that complex knowledge transfer is critical for their business. As a result, the companies ________. cluster employees in corporate campuses encourage employees to work from home frequently link global employees using teleconferences ask employees to keep detailed notes
cluster employees in corporate campuses
A company pursuing a differentiation strategy must ________. use different raw materials than competitors adjust its processes to different strategies provide different products than competitors create a perceived positive difference between its products and services and competitors' products and services
create a perceived positive difference between its products and services and competitors' products and services
Samsung electronics is headquartered in Suwon South Korea about an hour south of Seoul, in a building next to the corporate headquarters Samsung conducts R&D. Adjacent to this building Samsung produces memory chips that are used in computers and phones around the world. Co-locating R&D, design and production helps the company to ________. meet local content requirements enter foreign markets create tight linkages in its value chain spread the risk
create tight linkages in its value chain
A primary advantage of licensing is that it allows an international company to ________. sell complex technologies to other markets give the company greater control quickly move down the learning curve enter markets outside its strategic goals
enter markets outside its strategic goals
The liability of foreignness suggests that ________. distance is an effective proxy for foreignness foreign firms face unique challenges operating in foreign markets local companies are more advanced than foreign firms foreign firms face larger tax burdens
foreign firms face unique challenges operating in foreign markets
Global firms often struggle to invest in market creating innovation because ________. they do not pay off R&D for creating new markets isn't practical the risks are too great investment decisions are often based on short-term metrics
investment decisions are often based on short-term metrics
An advantage of pursuing a locally responsive strategy is that ________. it reduces the level of required investment it allows firms to achieve economies of scale it allows a firm to export to new markets it allows firms to have a say in shaping policies and regulations
it allows firms to have a say in shaping policies and regulations
The primary disadvantage of being locally responsive is that ________. it creates problems with local governments it does not make money for global businesses it requires product standardization it makes it difficult to achieve economies of scale
it makes it difficult to achieve economies of scale
An ethnocentrism bias means that ________. local customers prefer local brands and pay more for local brands local customers prefer local brand but pay more for global brands local customers prefer global brands but local brands cost more local customers prefer global brands over local brands
local customers prefer local brands and pay more for local brands
Using the example from question 10, identify what strategy Honda is most likely to pursue? Honda motorcycles decided to build a plant in Brazil that can produce 10 times the current demand of motorcycles to achieve economies of scale Transnation meganational/multidomestic low cost/differentiation
meganational
A cost leadership strategy suggests that a company ________. produces a lower price model always offer the lowest price provide the lowest cost for a given level of service focuses on achieving the absolute lowest cost
provide the lowest cost for a given level of service
A recent trend in multination companies' R&D is to ________. consolidate R&D to emerging markets consolidate R&D to headquarters spread R&D to multiple markets reduce R&D investments
spread R&D to multiple markets