Chpt 6 SB

Identify a risk related to international marketing.

A country or group of countries may boycott businesses from a specific country.

Why is it important for foreign companies to understand the standpoints of the major political parties in the country they would like to do business with?

Because political parties in power shape trade policy.

Identify a way in which feelings of nationalism make themselves evident.

Citizens purchase only items made within their country

Which of the following are labor problems that companies can face in foreign countries?

Companies may be required to share profits. Companies may not be allowed to lay off workers.

Identify a way in which militant nationalism is exhibited.

Confiscation of multinational corporations' assets

Which of the following is considered a threat to national sovereignty?

The World Trade Organization (WTO)

What makes U.S. companies doing business in foreign countries attractive as targets for terrorism?

They are symbols of the political and cultural system that terrorists disagree with.

Why were nationalized businesses historically rarely able to improve a country's economic development? (Check all that apply.)

They could not compete in the global marketplace. They were less efficient than private businesses.

Why do countries domesticate foreign investments or companies?

To increase the amount of profits kept within the country.

Identify the problems related to cyberterrorism. (Check all that apply.)

Tracing the crime back to the cyberterrorists and criminals is difficult. Determining the nature of the cyberattack is not easy.

International business problems are often caused by

a state exercising laws beyond its geographical boundaries.

Identify the issue that may affect the stability of a government.

an extremist party gaining power

Identify the main political causes for instability in international markets. (Check all that apply.)

antagonism between certain countries election of a new political party to powe

The seizing of a company's assets without compensation is known as .

confiscation

_____ is the most drastic political risk that foreign investors face.

confiscation

The United States of America is a _____.

constitutional federal republic

Following the collapse of colonialism, _____ was seen as the best solution to all the criticisms of government.

democracy

A sovereign state can do which of the following?

determine its geographical borders make deals with other sovereign nations

occurs when host countries use a series of government decrees that mandate local ownership and greater national involvement in a company's management to transfer foreign investments to national control and ownership.

domestication

Countries attract international investment in certain high-priority sectors by offering

exemption from exchange controls. tax breaks.

When the government of a country seizes an investment but makes some reimbursement for the assets, it is engaged in _____.

expropriation

True or false: A sovereign state's laws apply to its citizens only when they are within the state's geographical boundaries.

false

True or false: International companies lose money when doing business with politically radical governments.

false

Some people consider _______ to be especially hazardous to national sovereignty.

foreign investment

A multinational company can be profitable under any type of government if the government

has a stable foreign trade policy with the company.

For an international business, the best type of sovereign state to do business with is one that

has a stable government. is receptive to foreign investment.

Multinational companies may encounter problems when

labor unions are powerful and supported by the government.

Identify a reason for instability in international marketing.

nationalism

can best be defined as an intense feeling of national pride and unity, a kindling of national pride in the people of a country.

nationalism

Countries that display militant nationalism may _____. (Check all that apply.)

nationalize industries discourage foreign investment

One of the central aims of economic nationalism is the

protection of economic independence.

A sovereign state has the power to

regulate its national and international trade. oppose direct foreign investment. require its citizens to follow laws.

A sovereign state can

regulate who may enter and leave the state. regulate trade with foreign entities. reject applications for citizenship.

A sovereign state has the power to

require its citizens to follow laws. oppose direct foreign investment. regulate its national and international trade.

Feelings of nationalism are often exhibited through _____.

strict control over foreign investment

The countries of Vanadia and Bardemia have an agreement to trade various perishable products. Vanadia noticed a decline in the sale of its products in Bardemia. However, perishables from other countries were doing well. Marketers from Vanadia found that the problem stemmed from Bardemians' distrust of Vanadia due to previous military conflict. This scenario exemplifies _____.

targeted fear and animosity

A sovereign state's land is ultimately governed by

the sovereign state itself

What causes a country to exercise exchange control?

too much money leaving the country

To understand what the people of a country believe and fear, and why they are prejudiced about certain matters, a marketer should be familiar with not only current events, but also the nation's entire history.

true

True or false: Stable governments may drastically change their policies regarding international trade and foreign investment.

true

True or false: Surprising and/or extreme political shifts in government policy deter foreign investment.

true

_____________ refers to both the powers exercised by a state in relation to other countries and the supreme powers exercised over its own members.

Sovereignty

Identify the goals of terrorism. (Check all that apply.)

It aims to acquire money through kidnapping high-level employees and demanding ransom. It aims to disrupt daily life and cause widespread terror.

From an international law perspective, a sovereign state can do which of the following? (Check all that apply.)

It can sign treaties with other states. It can govern its own territory.

Identify the true statements regarding political risk assessment. (Check all that apply.)

It is an attempt to predict political instability. It helps managers identify and assess political events.

According to Steven Pinker, which of the following reasons explain lower rates of violence on the planet? (Check all that apply.)

Laws and governance An increase in the involvement of women in the government

Which of the following statements are true about changes in government in foreign countries?

Multinational corporations are less interested in who is in political power than continuity of operations. Business operations may continue regularly in a country experiencing political upheaval and change.

Which of the following products are most likely to be categorized as politically sensitive?

Products that symbolize the company's home country

Which of the following countries precluded women from voting until the king permitted women to vote in 2015?

Saudi Arabia

Which of the following helps reduce disruptions to international trade?

Seeking resolutions to trade disputes

How do some underdeveloped countries quickly acquire operating funds?

Severe taxation of profitable foreign businesses