Mgmt 458 Midterm Review

While it might differ in other countries, in the United States the customary distance apart that should be used in a business discussion is

5-8 feet.

Which of these companies exemplifies the globalization of markets?

Back Love Mattresses, a U.S.-based mattress company, sells the same mattresses worldwide.

Which scenario best represents a mores violation?

Bribing a government official in a country where bribery is illegal.

Which country has seen their share of world output increase the most from 1960 to today?

China

A tool manufacturer is planning to set up a production plant abroad. It has selected five potential countries based on their population size, stage of economic development, labor costs, and access to world markets. Considering the connection between culture and competitive advantage, which country would be the best investment site for this company

Country B, where education is well-developed and social stratification is lacking.

Solar Solutions, a U.S.-based company, is planning to expand operations to a foreign country. Considering the factors that make a country attractive as a place in which to do business, which country should Solar Solutions consider for entry?

Country D, which has democratic institutions and a market-based economic system

A U.S. company is planning to expand its operations to Japan, where the group is the primary unit of social organization, and hiring locals as the primary employee base. According to this information, what is a likely outcome for this company when operating in Japan?

Employees will achieve close cooperation with others.

According to globalization opponents, what is a disadvantage of globalization?

Globalization results in companies "exporting jobs" to low-wage nations.

Which language is spoken as the mother tongue by the largest number of people in the world?

Mandarin

__________ gives employees the integrity to blow the whistle on persistent unethical behavior in a company.

Moral courage

What occurs according to Moore's law?

The power of microprocessor technology doubles and its cost of production falls in half every 18 months.

What is one criticism regarding Geert Hofstede's research on cultural dimensions?

The research team consisted of only Europeans and Americans.

According to globalization supporters, what is an advantage of globalization?

The share of national income by skilled labor has increased.

What is an accurate description of how the political economy of many of the world's nation-states has changed radically since the late 1980s?

There has been a move away from centrally planned and mixed economies and toward a more free market economic model.

Of the two organizations created at Bretton Woods in 1944, which is considered the less controversial?

World Bank

Which institution was established as a result of the Uruguay Round of GATT?

World Trade Organization

A country that has __________ is an unattractive choice for international business

a closed totalitarian dictatorship

People in the West tend to associate a representative democracy with

a market economic system

A country's national competitive advantage and its attractiveness as a location for international business are most influenced by

a well-developed education system.

Manny, an American executive, learns that a foreign subsidiary hired a 10-year-old orphan boy to work on the factory floor. He knows that using child labor is in direct violation of the company's own ethical code. At the same time, he does not think that denying the child his only source of income is right. Manny is facing

an ethical dilemma

Dominick has analyzed the overall attractiveness of doing business with three possible countries and has determined that Country A is the best choice based on the potential for huge economic growth that should occur there because of recent advances in technology. Which factor of overall attractiveness is Dominick basing his decision on?

benefits

Collin knows it is wrong for his company to continue pouring manufacturing waste products into the water system based on environmental standards set down by the state. Collin is demonstrating a lack of

business ethics

Grossman and Krueger's study revealed the relationship between pollution levels and income. Which pollutant was the exception to their study?

carbon dioxide

As a judge in Germany, William is not allowed to interpret the law but relies on a strict set of codes to determine the outcome of a case. Which type of law is in place in Germany?

civil law system

An individual's right to do something may be restricted on the grounds that it runs counter to "the good of society" when the political system emphasizes

collectivism

A __________ economy follows the principles of collectivism as resources are allocated based on "the common good."

command

Historically, communist countries focused on collectivist goals. The government planned production, fixed commodity prices, and also directed investments to ensure they benefitted the nation as a whole and not only a few individuals. What type of economy did this represent?

command

More nations have gravitated toward the market-based model because

command and mixed economies failed to deliver sustained economic performance

With increased economic progress, cultures across the world seem to be moving toward some universally accepted values and norms. This is known as the

convergence hypothesis.

If Shondra was working in the home office in Florida, she never would have agreed to pay the government official to speed up the delivery of the cargo; however, since she is working in the company's foreign office, she agrees to the practice since it is considered normal in this country. Which philosophical approach to ethics is Shondra using to make her decision?

cultural relativism

The system of values and norms that are shared among a group of people and together create a design for living is known as a

culture

Deirdre works as the executive manager of an international business, while Tomas is the executive manager of a purely domestic business. Which of these responsibilities apply to both Deirdre and Tomas?

dealing with business attacks from competitors

A country that abolishes laws that regulate private enterprises and removes price controls is in the process of

deregulation

The Simpson Group decided against doing business with a country in Central America because the country exercises tight control over prices and output, prohibits private enterprises from operating in most sectors of the economy, and severely restricts foreign direct investment and international trade. In other words, this country is against the practice of

deregulation.

What was the motivation for non-U.S. firms to begin investing across national borders in the 1970s?

desire to disperse production activities to optimal locations

The two caveats of the Sullivan principles are first, a company should not obey the apartheid laws in its own South African operations and second, a company should

do everything possible to abolish apartheid laws

The main reason that gross national income figures can be misleading is because they

don't consider differences in the cost of living.

When Steve Jobs and Steve Wozniak cofounded Apple, they were acting as __________ since they were the first to commercialize this innovative new product.

entrepreneurs

Charlize is from South Africa and believes that the customs and beliefs of her culture are superior to those she has encountered during her trip to America. Charlize's attitude is an example of

ethnocentrism

A country that has lax intellectual property laws will find that

firms will be reluctant to enter into such a country.

Madeline is always late to meetings. She knows she needs to improve her time management because it is a typical expectation in the United States. This attitude toward time is an example of a

folkway

Texas-based Cowboy Food Groups has invested resources in business activities in Mexico. What type of business activity does this represent?

foreign direct investment

Economist Robert Reich advocates that the outsourcing of productive activities to different suppliers results in the creation of

global products.

The merging of national markets that have historically been distinct and separate is the process of

globalization

One cost-cutting measure used by E-Z Out Garage Door Co. is sourcing the parts it uses from companies in Germany, Brazil, and Mexico that are more economical than home-country sources. The choice to use these sources is an example of the

globalization of production.

In a pure command economy, the prices at which goods and services are sold are planned by the

government

A payment made to expedite or to secure the performance of a routine governmental action is called a

grease payment.

Payments used to ensure receiving the standard treatment that a business ought to receive from a foreign government, but might not due to the obstruction of a foreign official, are called

grease payments

Within the context of the individual as the basic unit of a social organization, what is a manifestation of the emphasis on individualism in many Western societies?

high degree of managerial mobility between companies

In the Republic of Nabu, natives are resistant to change and do not like to take risks. They value job security and retirement benefits. In addition, they have a strong need for rules and regulations. Based on this information, the Republic of Nabu demonstrates which cultural dimension identified by Hofstede?

high uncertainty avoidance

In the United States, citizens have the freedom to pursue the economic and political activities that interest them. This is an example of the philosophy of

individualism.

The development of new products, processes, organizations, management practices, and strategies is called

innovaton

Marek owns 100 shares of stock in Sun Telecom. He would be considered a(n)

internal stakeholder.

Canadian company Nature's Yogurt exports a number of products to consumers in Brazil, Chile, and Argentina. According to this information, Nature's Yogurt is most likely involved in

international trade.

Which ethical approach typically focuses on the attainment of fair and equitable distribution of economic goods and services?

justice theories

What is an example of a factor of production?

labor

U.S.-based Nelson Corporation is hesitant about entering into a licensing agreement with Lapson, Inc., a company from another nation, due to the likelihood that Lapson will break a contract or expropriate property rights. What specific type of risk is Nelson Corporation trying to avoid?

legal

What is one of the three measures used to determine the Human Development Index (HDI) of a country?

life expectancy at birth

In Denmark, the personal income tax rate is 55 percent. One of the reasons workers are willing to pay this is because they know they will reap the benefits later in the form of free health care and a universal pension in retirement. According to Geert Hofstede, what cultural dimension does this most illustrate?

long-term versus short-term orientation

Daveed is the warehouse supply manager for a privately owned auto parts distributor. It is his job to take inventory of the products the company has available and place orders for parts when supplies run low. This supply and demand form of production is an example of a __________ economy.

market

Abby asked the management team to consider how they would feel if they were asked to travel more than 65 miles to get to work—which is what they were asking the management team at the foreign office to do. Abby is relying on __________ to approach this ethical situation.

moral imagination

Sun and Fun is a U.S.-based company that specializes in protective clothing to be worn at the beach or pool. The company recently opened a production facility in Brazil and another in Europe. What type of enterprise is Sun and Fun?

multinational

The __________ approach to ethics advocates that a manager in a multinational firm who sees other firms operating in the same nation not following ethical norms, may follow suit and not follow ethical norms either.

naive immoralist

The social rules and guidelines that prescribe appropriate behavior in particular situations are called

norms

Wise Eyes Corporation has developed a new oral supplement to prevent macular degeneration. Which type of legal protection grants Wise Eyes Corporation exclusive rights for a defined period to the manufacture, use, or sale of this new supplement?

patent

Ocean Athletics is hesitant about entering Ukraine, because the country has been experiencing social unrest in recent years. Based on this information, what type of risk is Ocean Athletics trying to avoid?

political

Several factors that are probably more important to an explanation of differential economic growth rates over time than culture include

political systems.

Jamal operates a company that manufactures dog food. He pays his factory workers minimum wage, while he pays his managers twice as much with profit sharing. This represents which of Hofstede's cultural dimensions?

power distance

Under common law, __________ refers to the ways in which laws are applied in specific situations.

precedent

One root cause of unethical behavior in business is

pressure to meet unrealistic performance goals

In 2017, the Brazilian government transferred the state ownership of the electric company, the airports, highways, and ports to private investors to stimulate the economy. This is an example of

privatization

Josef told the management team that the company would have to find a new way to produce the Walk-A-Lot Doll because the government had recently banned "exposed component parts in toys" and the doll's walking mechanism was visible on her back. The standard set by the government is a type of

product safety law.

Economist Hernando de Soto believes that the benefits of capitalism will not be achieved until

property rights are better protected.

The state senator was found guilty of __________ when she tried to overcharge for licenses and permits from an international business that wanted to open a manufacturing plant in her state.

public action

Anastasia asked her assistant to determine the gross national income of six different countries by evaluating the GNI against the cost of living in the United States. What measure is Anastasia asking her assistant to use?

purchasing power parity

In the United States, citizens have the right to elect officials who make decisions on behalf of the public. This practice is the reason the United States is a

representative democracy.

The United Nations Convention on Contracts for the International Sale of Goods (CISG) was introduced to

resolve disputes that arise in international trade regarding which country's laws to apply.

Which philosophical approach claims that a multinational's home-country standards of ethics are the ones employees should follow even when working in foreign countries?

righteous moralism

Collin was born into a poor family, but he worked hard during high school and went on to receive his master's degree in business followed by a high-level job. Today, he is considered "upper middle class" and enjoys a comfortable lifestyle. Collin's journey is an example of

social mobility.

The social strata evident in a society is primarily derived from

socioeconomic characteristics

A __________ is an individual or group that has an interest or claim in what a company does and how well it performs.

stakeholder

Strategies that not only help the multinational firm make good profits, but that do so without harming the environment while simultaneously ensuring that the corporation acts in a socially responsible manner with regard to its stakeholders are called

sustainable strategies.

The base for the adjustment of purchasing power parity is the cost of living in

the United States.

It has been noted that there is a connection between individualism that is fostered by Protestantism and

the extent of entrepreneurial activity in a nation.

During the second stage of the ethical decision-making process, managers must determine whether a proposed decision would violate

the fundamental rights of any stakeholders

Kellen Builders decides to move production to a developing country where they are free to pump pollutants into the atmosphere without legal restriction. By doing this, the company is contributing to

the global tragedy of the commons

In his theory of absolute advantage, Adam Smith advocated that __________ should determine what a country imports and what it exports.

the market mechanism

When considering globalization, what is thought to be the single most important innovation since World War II?

the microprocessor

The basic position of the Friedman doctrine says that

the only social responsibility of business is to increase profits, so long as the company stays within the rules of law

A country that has __________ lowers the risk of doing business in that country.

the presence of a strong legal system

The spread of democracy among countries is most likely to lead to

the promotion of greater competition.

Miller Plastic Group is considering two different countries for their upcoming expansion. When the board was reviewing the financial figures of the countries, the chief financial officer reminded board members that the figures might not tell the entire story as some economic activity could be taking place in the form of barter agreements and cash transactions that are never recorded. What is the CFO referring to?

the shadow economy

A number of employees at Organic Growers Inc., which is headquartered in a country where masculinity and power distance are high, do not behave in an ethical manner. In this context, the roots of unethical behavior can be traced to

the societal culture

A form of government in which political power is monopolized by a party, group, or individual that governs according to religious principles is called what type of totalitarianism?

theocratic

Why was the World Trade Organization established?

to police the international trading system

Communists believed that socialism could only be achieved through

totalitarian dictatorship.

What political system has a government in which one political party exercises absolute control over all spheres of human life and doesn't allow opposing political parties to exist?

totalitarianism

Farm-Supply Inc., which is headquartered in the United States, has its production plant located in a developing country where working conditions are poor. For example, employees work 12-hour shifts, are exposed to toxic chemicals, and are paid extremely low wages. The practices Farm-Supply Inc. is demonstrating could be labeled as

unethical.

Sun-Jun relies on a cost-benefit analysis to decide if moving operations overseas is better than increasing the size of the current manufacturing facility in the United States. He is using the __________ approach to ethics to determine his answer

utilitarian

Fenton Incorporated plans to do business with a company located in the Leone Republic, a common law country. The companies have agreed to draft the business contract in the Leone Republic. Since the contract will be drafted under a common law framework, it will be

very detailed with all contingencies spelled out.