IBA-350 Test 2 Study Material

A firm can reduce its marketing and advertising costs substantially by focusing on numerous national brands instead of a single global brand. True False

False

Obtaining economic development incentives from​ host-or home-country governments increases the cost of trade and investment barriers. True False

False

In the early stages of market​ research, managers examine three important statistics to estimate market​ potential: per-capita​ income, size of the middle​ class, and market potential indicators. True False

True

Which one of the following was the first major effort to systematically reduce trade barriers​ worldwide? A.EU B.GATT C.WTO D.FTZ E.NAFTA

B.GATT

Which of the following characterizes​ extraterritoriality? A.Applying​ home-country laws to persons outside national borders B.Restricting the amount of net income firms can remit to home countries C.Limiting foreign investment that may affect national security D.Revealing significant information about a​ firm's financial condition E.Requiring foreign investors to seek joint ventures with local firms

A.Applying​ home-country laws to persons outside national borders

Which of the following characterizes​ extraterritoriality? A.Applying​ home-country laws to persons outside national borders B.Restricting the amount of net income firms can remit to home countries C.Requiring foreign investors to seek joint ventures with local firms D.Revealing significant information about a​ firm's financial condition E.Limiting foreign investment that may affect national security

A.Applying​ home-country laws to persons outside national borders

Which of the following are environmental conditions that influence a​ firm's product​ development? A.Cultural and financial factors B.Internal distribution factors C.Target customer segments and positioning factors D.Global branding factors E.International marketing communication factors

A.Cultural and financial factors

Which of the following describes the Foreign Corrupt Practices Act​ (FCPA)? A.Firms are prohibited from offering bribes to foreign firms to obtain business. B.Bribes are an accepted way of doing business overseas. C.Foreign firms can make payments to American firms while doing business in the United States. D.Companies with securities listed in the United States are exempt from U.S. accounting provisions. E.FCPA criminal and civil penalties are minimal.

A.Firms are prohibited from offering bribes to foreign firms to obtain business.

Under which one of the following organizational structures are management and control highly decentralized to the level of individual​ regions? A.Geographic area structure B.Product structure C.Functional structure D.Global matrix structure E.International division structure

A.Geographic area structure

A large cosmetics company is looking to break into international markets. What strategy should the company pursue to achieve this​ goal? A.It should develop a global brand. B.It should spend as much on advertising as possible. C.It should imitate its​ competitors' strategy. D.It should have various national brands. E.It should establish an inexpensive distribution chain.

A.It should develop a global brand.

Which of the following is a strategy managers can employ to manage country​ risk? A.Maintaining a strict adherence to ethical behavior B.Using bribes to develop international business C.Engaging in questionable practices that are not specifically outlawed D.Seeking a loan from the World Bank E.Using a SIG to lobby for special favors

A.Maintaining a strict adherence to ethical behavior

Which of the following best summarizes the argument in favor of​ microfinance? A.Microfinance allows the underprivileged to create businesses and improve their lives. B.Microfinance ultimately leads to greater tax revenues for national governments. C.Recently, mainstream banks have begun to view microfinance as the prime driver of advanced economies. D.Microfinance alleviates the pressure on MNEs to support developing economies.

A.Microfinance allows the underprivileged to create businesses and improve their lives.

Which term defines managerial​ procedures, actions, and mechanisms that allow an organization to operate as​ planned? A.Organizational processes B.Global teams C.Visionary leadership D.Global matrix structure E.Organizational culture

A.Organizational processes

Which of the following identifies the reporting relationships in an​ organization? A.Organizational structure B.Visionary leadership C.Home replication strategy D.Local responsiveness E.Organizational culture

A.Organizational structure

The United States has implemented trade sanctions on Iran and Syria. What is the purpose of​ sanctions? A.Sanctions punish unwanted activities by foreign countries. B.The government confiscates property with no compensation. C.Sanctions terminate contracts and create new laws that favor local firms. D.Consumers may refuse to patronize firms that behave badly. E.Sanctions show a voluntary refusal to engage in commercial dealings with a nation.

A.Sanctions punish unwanted activities by foreign countries.

________ is a planned set of actions that managers employ to make best use of the​ firm's resources and core competencies to gain competitive advantage. A.Strategy B.Globalization C.Multinational flexibility D.Competitive advantage E.International business

A.Strategy

What is the basis of common​ law? A.Tradition, previous​ cases, and legal precedents B.Two or more legal systems operating together C.Religious​ beliefs, ethical​ codes, and moral values D.Three separate​ codes: commercial,​ civil, and criminal E.An​ all-inclusive system of laws that have been codified

A.Tradition, previous​ cases, and legal precedents

In international​ advertising, the receptiveness of the buyer to advertising changes is a function of​ ________. A.culture B.laws C.media availability D.market segmentation E.positioning

A.culture

In international​ business, firms frequently formulate market segments by​ ________. A.grouping countries based on​ variables, such as level of economic development or cultural dimensions. B.selling only those products that create derived demand for other related products in the market C.grouping competitors based on their hiring strategies D.grouping identical customers in underground economies

A.grouping countries based on​ variables, such as level of economic development or cultural dimensions.

​________ is made up of two critical​ features: (1) limited government and​ (2) the ability for citizens to own property and​ assets, and attain individual wealth. A.A mixed system B.A democracy C.Socialism D.A command economy E.Totalitarianism

B.A democracy

Which of the following is an advantage of regional​ integration? A.Economies of scale B.All choices are correct C.Increased production D.Attract direct investment E.Expanded market size

B.All choices are correct

Question content area top Part 1 Which one of the following encourages the need for global​ integration? A.Leveraging natural endowments available to the firm B.Catering to the needs of local customers C.Responding to local competitors D.Accommodating distribution channel differences E.Providing uniform service to global customers

B.Catering to the needs of local customers

An American company that does business overseas has to be concerned about local events. Why should a company be concerned about political events and the legal environment in the country in which it does​ business? A.Changes in the legal environment might influence the government to encourage​ cross-border collaborations. B.Changes in the political climate might influence government interference in business​ practices, putting the safety of the​ company's employees in jeopardy. C.Unfavorable developments could lead to new conditions that require the company to protect its intellectual property. D.Initiatives developed by special interest groups could lead to the company experiencing supply chain issues. E.Shifting priorities in political parties might cause unfavorable government interference with domestic firms.

B.Changes in the political climate might influence government interference in business​ practices, putting the safety of the​ company's employees in jeopardy.

Which term defines the business transactions where payments are made in kind instead of in​ cash? A.Importing B.Countertrade C.Global sourcing D.Exporting E.Home replication

B.Countertrade

A firm most likely opts for global integration in order to take advantage of which of the following​ factors? A.Leveraged natural resources B.Economies of scale C.Responsiveness to local competitors D.Customized products E.Adaptation to different distribution channels

B.Economies of scale

​________ include countries that have attained significant​ modernization, industrialization, and rapid economic growth since the 1980s. A.Advanced economies B.Emerging economies C.Centrally planned economies D.Developing markets E.Developed economies

B.Emerging economies

​________ enables an MNE to accommodate various​ country-specific challenges and opportunities. A.Technical​ know-how B.Flexibility C.Efficiency D.A home replication strategy E.A strong organizational culture

B.Flexibility

Which one of the following provides the most control over foreign​ operations? A.Exporting B.Foreign direct investment C.Countertrade D.Franchising E.Licensing

B.Foreign direct investment

Which of the following primarily focuses on ensuring the reduction of tariffs among certain countries and settling trade​ disagreements? A.European Union B.General Agreement on Tariffs and Trade C.World Bank D.Smoot-Hawley Tariff Act E.United Nations

B.General Agreement on Tariffs and Trade

Which one of the following characteristics is related to economic​ freedoms? A.Unrestricted and reasonable elections B.Market forces and the ability to easily implement commercial activities C.The right to establish political parties D.Fair electoral rights E.Freedom from total control by military forces

B.Market forces and the ability to easily implement commercial activities

Many Middle Eastern countries practice both civil law and Islamic law. In this​ case, under which legal system are these countries ultimately​ categorized? A.Rule of law B.Mixed system C.Religious law D.Mixed economy E.Common law

B.Mixed system

Which of the following statements about NAFTA is​ TRUE? A.NAFTA decreased market access among​ Canada, Mexico, and the United States. B.NAFTA allowed​ member-country firms to submit bids for government contracts in the three signing countries​ (Canada, Mexico, and the United​ States). C.NAFTA implemented tariffs for products and services traded in the bloc. D.NAFTA caused a reduction in U.S. exports to Canada and Mexico. E.NAFTA does not offer dispute settlement in areas of​ investment, unfair​ pricing, labor​ issues, and the environment.

B.NAFTA allowed​ member-country firms to submit bids for government contracts in the three signing countries​ (Canada, Mexico, and the United​ States).

Which one of the following is true of political and legal environments in international​ business? A.Country risk is present only in some countries and only during times of political change and upheaval. B.Political and legal systems are interdependent. C.The political and legal systems in a country are usually fixed and unchanging. D.Gradual change in a​ country's political and legal environments poses a greater risk to firms than does sudden change. E.In disputes between local and foreign​ firms, governments protect foreign interests.

B.Political and legal systems are interdependent.

Which of the following describes a legal system with clear rules that are publicly​ disclosed, enforced​ fairly, and respected by​ individuals, organizations, and the​ government? A.Civil law B.Rule of law C.Common law D.Mixed system E.Religious law

B.Rule of law

The strength of a global brand is measured by​ ________. A.market segmentation B.brand equity C.a global marketing strategy D.global positioning E.brand standardization

B.brand equity

​Low-income countries like Bangladesh and Nicaragua are categorized as​ ________ because they have limited industrialization and stagnant economies. A.transition economies B.developing economies C.emerging economies D.centrally planned economies E.advanced economies

B.developing economies

Regional integration enables member countries to gain bargaining power in world affairs by​ ________. A.helping member country firms to achieve economies of scale B.establishing a stronger political position as a united bloc C.expanding the market size of member country firms D.attracting direct investment from outside the bloc E.enhancing the productivity of member countries

B.establishing a stronger political position as a united bloc

Emerging markets have become target markets because​ ________. A.in some product​ categories, there is little demand in emerging markets B.governments in emerging economies attract sales of​ infrastructure-related products C.the majority of individuals in emerging economies live in poverty D.the shrinking middle class in emerging markets implies a lower demand for consumer products E.the largest emerging markets have reduced their share of world imports in the last few years

B.governments in emerging economies attract sales of​ infrastructure-related products

Purchasing power parity​ (PPP) adjusts prices to​ ________. A.take into account emerging markets that have recently doubled in share of world imports B.reflect the goods consumers can​ buy, as well as account for their currency and standard of living C.help procure products and services from suppliers or subsidiaries that operate abroad D.show how much income is held by an​ economy's middle class compared with its size E.demonstrate how much of a good one can buy in a particular​ currency, such as the U.S. dollar

B.reflect the goods consumers can​ buy, as well as account for their currency and standard of living

A coordinated approach to internationalization in which the firm strives to be relatively responsive to local needs while retaining sufficient central control of operations is a​ ________ strategy. A.multidomestic B.transnational C.home replication D.global E.vision

B.transnational

Top managers who provide inspirational direction and motivation to employees in an attempt to take a company to a better future are exhibiting​ ________. A.efficiency B.visionary leadership C.technical skills D.discipline E.flexibility

B.visionary leadership

Which one of the following is NOT true of a global​ brand? A.A firm has more influence with retailers and intermediaries. B.A global brand develops a competitive advantage for a firm. C.A global brand decreases customer loyalty. D.A global brand adds to a marketing​ program's efficiency. E.Premium prices can be charged for a global brand.

C.A global brand decreases customer loyalty.

What is the benefit of environmental​ scanning? A.Evaluating accounting practices B.Reducing research and development costs C.Assessing potential threats to the firm D.Improving intellectual property protection E.Forming a regional trading bloc

C.Assessing potential threats to the firm

Which one of the following officially bans imports from and exports to a specific country in an attempt to impose a political​ punishment? A.Sanction B.Confiscation C.Embargo D.Boycott E.Nationalization

C.Embargo

Which of the following represents a​ low-control strategy? A.Foreign direct investment B.Franchising C.Exporting D.Equity joint ventures E.Licensing

C.Exporting

​________ means serving a key international customer in a consistent and standardized​ manner, regardless of where in the world it operates. A.Product adaptation B.Global retailing C.Global account management D.Positioning E.Marketing promotion

C.Global account management

​________ refers to the procurement of products or services from independent suppliers or​ company-owned subsidiaries located abroad for consumption in the home country or a third country. A.A new global challenger B.Outsourcing C.Global sourcing D.Privatization E.A developing economy

C.Global sourcing

​________ formulate best practices that the firm implements in all its units worldwide. A.Supply chain managers B.Cross-cultural teams C.Global​ new-product planning teams D.Local managers E.Distributors

C.Global​ new-product planning teams

Which of the following​ determine(s) the nature of international marketing​ communications? A.Promotional activity B.Gray market activity C.Media availability and quality D.Distribution chains E.Transfer pricing

C.Media availability and quality

Which of the following BEST describes the role of an​ intermediary? A.Creating a sales outlet in a domestic market B.Establishing business overseas using FDI C.Moving products through a distribution channel to a retailer D.Exporting products abroad E.Establishing marketing subsidiaries in target markets

C.Moving products through a distribution channel to a retailer

Which of the following is a risk associated with emerging​ markets? A.Political stability that is associated with transparency B.Tax incentives that attract foreign investment C.Political instability that is associated with weak legal frameworks D.National laws that protect intellectual property E.Administrative rules that facilitate business activities

C.Political instability that is associated with weak legal frameworks

Which one of the following is a collection of official organizations that create a​ government, including legislative​ groups, political​ parties, lobbying​ groups, and trade​ unions? A.Common law B.Civil law C.Political system D.Legal system E.Mixed system

C.Political system

Question content area top Part 1 ​________ pertains to national economic policies that restrict free trade and protect domestic industries from foreign competition. A.A custom B.A tariff C.Protectionism D.A quota E.A nontariff trade barrier

C.Protectionism

What causes international prices to​ rise? A.A lack of significant disposable income B.Low-cost labor C.Tariffs, taxes, and markups by foreign intermediaries D.Factories located near markets E.Local regulations

C.Tariffs, taxes, and markups by foreign intermediaries

Which of the following coordinates​ economic, social, and cultural affairs among​ Bahrain, Kuwait,​ Oman, Qatar, Saudi​ Arabia, and the United Arab​ Emirates? A.Association of Southeast Asian Nations​ (ASEAN) B.European Free Trade Association C.The Gulf Cooperation Council​ (GCC) D.Asia Pacific Economic Cooperation​ (APEC) E.The Australia and New Zealand Closer Economic Relations Agreement​ (CER)

C.The Gulf Cooperation Council​ (GCC)

If you are a business looking for a foreign market in which to sell​ goods, what does economic freedom in a country mean to your​ business? A.The government will pass legislation that increases protectionism. B.The government will enact laws that limit the amount of currency that can be taken out of the country. C.The government will support foreign business by enacting laws that decrease import quotas. D.The government will support foreign business by enacting laws that increase export controls. E.The government will increase tariffs.

C.The government will support foreign business by enacting laws that decrease import quotas.

Which of the following statements BEST describes the European Union​ (EU)? A.Multiple currencies make trade easier for firms doing business within the EU. B.Eleven EU countries belong to a monetary union that uses the pound. C.Trade among the EU members takes place unobstructed. D.The EU is a political union with the same laws throughout. E.Labor and capital are unable to move freely among the EU members.

C.Trade among the EU members takes place unobstructed.

A global brand can best be defined as​ ________. A.a brand with a complicated​ value-chain B.a brand that uses a variety of marketing campaigns in different markets C.a brand whose​ positioning, advertising​ strategy, look, and personality are standardized worldwide D.a brand that focuses on a single generational group within a country

C.a brand whose​ positioning, advertising​ strategy, look, and personality are standardized worldwide

TDC​ Industries, a U.S.​ firm, has established operations in​ Germany, so TDC Industries has free trade access to​ ________of the EU market. A.a large part B.none C.all D.a limited part E.a specific percentage

C.all

According to the​ author, the success of multinational firms has been based upon​ ________ and​ ________, which have become especially relevant during the worldwide recession. A.independent​ suppliers; high-cost parts B.generalized customer​ needs; domestic partnerships C.efficiency; flexibility D.risk-averse practices; human resource practices E.logistical​ operations; raw materials

C.efficiency; flexibility

Government intervention and trade barriers imposed by developed countries raise​ ______ for developing economies that supply them because tariffs are often disproportionately high. A.subsidies B.quotas C.ethical concerns D.export controls E.economic freedom levels

C.ethical concerns

​A(n) ________ is an arrangement in which management of the​ firm's international operations is organized by​ activity, such as production and marketing. A.geographical area structure B.international division structure C.functional structure D.global matrix structure E.product structure

C.functional structure

A​ firm's decision on how to position itself is part of its​ ________ strategy. A.standardization B.marketing mix C.global marketing D.market segmentation E.adaptation

C.global marketing

The​ ________ refers to an approach in which a firm views international business as separate​ from, and secondary​ to, its domestic business. A.multinational strategy B.transnational strategy C.home replication strategy D.multidomestic strategy E.global strategy

C.home replication strategy

What type of tariff is assessed as a percentage of the value of the imported​ product? A.specific tariff B.reverse tariff C.import tariff D.protective tariff

C.import tariff

Which of the following situations will discourage business activities of foreign firms in an emerging​ market? A.investing in a strong Internet infrastructure B.using a strong legal framework and patent laws C.increasing the requirements for​ licenses, approvals, and paperwork D.allowing foreign firms to access the​ country's energy resources

C.increasing the requirements for​ licenses, approvals, and paperwork

Regional integration leads to increased​ ________ by firms inside their economic bloc. A.isolation B.costs C.internationalization D.localization E.dumping

C.internationalization

Contractual relations usually take the form of​ ______, in which an organization allows an international partner to use its intellectual property in return for royalties. A.exporting B.countertrade C.licensing or franchising D.equity joint venture E.wholly owned subsidiaries

C.licensing or franchising

The new global challengers have become formidable competitors primarily because​ ________. A.of superior market research and customer service B.of substantial government​ funding, high​ wages, and​ value-chain diversification C.of the easy availability of​ low-cost labor, skilled​ workforces, government​ support, and family conglomerates D.of instant brand recognition

C.of the easy availability of​ low-cost labor, skilled​ workforces, government​ support, and family conglomerates

Rigid​ cost-plus pricing involves​ ________. A.setting prices to cover only variable costs B.setting prices to cover only fixed​ costs, but not variable costs C.setting a fixed price for all export markets D.adjusting prices based on customer demand E.changing prices according to the economic level of the market

C.setting a fixed price for all export markets

Adaptation is defined as​ ________. A.the​ firm's efforts to minimize employee attrition by rewarding performance B.the​ firm's efforts to make its marketing program elements​ uniform, with a view to targeting entire​ regions, or even the global​ marketplace, with the same product or service C.the​ firm's efforts to modify one or more elements of its international marketing program to accommodate specific customer requirements in a particular market D.the​ firm's attempt at altering its organizational structure to facilitate internationalization

C.the​ firm's efforts to modify one or more elements of its international marketing program to accommodate specific customer requirements in a particular market

Which of the following observations would stimulate investment in an emerging​ market? A.Government intervention in the business environment is common in emerging markets. B.Weak patent laws and counterfeiting characterize the Chinese market. C.​Africa's cell phone market has opened the door to many related industries. D.Political instability is often found in emerging markets. E.Foreign firms must deal with significant corruption in Russia.

C.​Africa's cell phone market has opened the door to many related industries.

Which of the following represents a method of negotiation in which the objective is to settle any disagreements in a pleasant​ manner? A.Litigation B.Arbitration C.Confiscation D.Conciliation E.Nationalization

D.Conciliation

Which of the following is a regional trade​ organization? A.World Bank B.International Monetary Fund C.United Nations Conference on Trade and Development​ (UNCTAD) D.European Union​ (EU) E.Stockholm Chamber of Commerce

D.European Union​ (EU)

An international technology company is deciding how to utilize its advertising budget for the year. Which of the following is the best​ option? A.Spend the budget on television and print ads B.Use the same campaign as in their home country C.Focus on Internet and radio ads D.Hire a global advertising agency E.Spend the budget on transit ads

D.Hire a global advertising agency

Which type of government intervention encourages foreign companies to enter a​ host-country market? A.Dumping B.Countervailing duties C.Currency controls D.Investment incentives E.Tariffs

D.Investment incentives

Why would a nation choose to be a member of an economic​ bloc? A.A nation can then become part of the World Trade Organization. B.Nations can pursue economic integration by reducing tariffs. C.An economic bloc imposes restrictions on labor. D.It is easier to reach an agreement on free trade with a few nations rather than with numerous countries. E.An economic bloc imposes restrictions on the​ cross-border flow of products.

D.It is easier to reach an agreement on free trade with a few nations rather than with numerous countries.

Why is the middle class used to determine market​ potential? A.Middle-class households in emerging markets have little disposable income. B.Middle-class households in emerging markets buy only simple necessities. C.The middle class makes up a very small proportion of households in advanced economies. D.Middle-class individuals are politically and environmentally active. E.Middle-class consumers cannot find professional jobs.

D.Middle-class individuals are politically and environmentally active.

Members of​ ________ benefited the most from the maquiladora program. A.MERCOSUR B.EU C.EFTA D.NAFTA

D.NAFTA

Which of the following is used by managers to analyze data to estimate market potential in a certain​ location? A.Intellectual property protection B.Political stability C.Physical infrastructure D.Purchasing power parity E.Size of the​ lower-class society

D.Purchasing power parity

An international supermarket chain is opening stores in foreign markets. Which adaptation could be made to accommodate national​ preferences? A.Using advertisements written in English B.Adjusting the distribution chain C.Adjusting prices for living standards D.Stocking local produce E.Using standardized promotions

D.Stocking local produce

What does a multidomestic industry have in common with local​ responsiveness? A.They both focus solely on domestic sales. B.They both incorporate all of the elements of a​ firm's value-chain activities. C.They both utilize centralized decision making. D.They both make decisions on a​ country-to-country basis. E.They both deal with product competition.

D.They both make decisions on a​ country-to-country basis.

​________ include groups of evolving markets that have progressed from centrally planned economies into liberalized markets. A.Underdeveloped countries B.Third-world countries C.Developing economies D.Transition economies E.Advanced economies

D.Transition economies

The root cause of gray market activity is​ ________. A.a​ firm's ability to control production and distribution costs B.the dominance of substandard products in local markets C.a difference in price between national distributors D.a significant difference in price of the same product between two countries

D.a significant difference in price of the same product between two countries

Which of the following is a characteristic of a global​ team? A.constant​ face-to-face interaction B.domestically based C.similarly trained D.culturally diverse

D.culturally diverse

Buyer receptiveness differs as a function of​ ________. A.lobbying B.product quality C.media expenses D.culture and language

D.culture and language

Which of the following activities would be considered last by a manager while developing​ strategies? A.analyzing the particular challenges that confront the firm B.examining the​ firm's specific strengths and weaknesses C.analyzing the particular opportunities for the firm D.deciding how best to contend with competitors

D.deciding how best to contend with competitors

Which of the following trends supports improving economic conditions in​ Africa? A.the rising cultural affinity toward goods manufactured in the West B.the gradual liquidation of the mining industry C.the growing importance of the public sector in Africa D.direct investment from abroad

D.direct investment from abroad

Companies help address poverty around the world in many ways. If a foreign firm in an emerging market modernizes local roads and bridges and creates jobs for workers in the​ community, the firm is​ ________. A.partnering with family conglomerates B.customizing products to meet local needs C.engaging in global sourcing D.encouraging economic growth E.engaging in microfinancing activities

D.encouraging economic growth

​A(n)________ is a designated location within a country that receives imported goods for assembly and then​ re-exports finished products. A.free trade agreement B.economic bloc C.regional bloc D.foreign trade zone E.political union

D.foreign trade zone

Governments impose offensive barriers to​ ________. A.protect domestic industries B.safeguard the interests of special interest groups C.promote national security D.pursue strategic or public policy objectives such as increasing employment

D.pursue strategic or public policy objectives such as increasing employment

​________ is the transfer of industries from state ownership to​ non-public entities. A.Outsourcing B.Targeting C.Modernization D.Global sourcing E.Privatization

E.Privatization

How does a foreign firm benefit from partnering with a family​ conglomerate? A.A foreign firm can increase the capital requirements needed for international transactions. B.A foreign firm can achieve economies of scale and avoid customizing products. C.A firm can seek out local lobby groups to deal with infrastructure issues. D.A foreign firm can use standardized products. E.A foreign firm can form close relationships with the local government.

E.A foreign firm can form close relationships with the local government.

​________ have high​ per-capita revenues, very competitive​ businesses, and strong infrastructures. They include​ Australia, Canada, and New Zealand. A.Developing economies B.Centrally planned economies C.Transition economies D.Emerging economies E.Advanced economies

E.Advanced economies

​________ is a governmental system that attempts to control most aspects of its​ citizens' conduct both publicly and​ privately, including their values and beliefs. A.A mixed system B.Democracy C.Socialism D.A market economy E.Authoritarianism

E.Authoritarianism

Which type of government seizure involves acquiring company possessions without any form of​ payment? A.Expropriation B.Arbitration C.Conciliation D.Nationalization E.Confiscation

E.Confiscation

________ refers to the possibility of loss or adverse effects on company operations and profitability as a result of changes in a​ country's political​ and/or legal environment. A.Social risk B.Financial risk C.International risk D.Cross-border risk E.Country risk

E.Country risk

Which one of the following approaches affords significant independence and​ decision-making authority to the​ firm's subsidiaries around the​ world? A.Product structure B.Functional structure C.Centralized structure D.Transnational strategy E.Decentralized structure

E.Decentralized structure

Which of the following refers to reducing the cost of a​ firm's global​ activities? A.Transnational strategy B.Visionary leadership C.Functional structure D.Strategy E.Efficiency

E.Efficiency

Which of the following statements about local responsiveness is​ FALSE? A.Firms adjust their practices to meet the specific needs of each country. B.Businesses take the local culture into consideration for transactions. C.Firms adjust to the local competitive environment. D.Companies adhere to local customer preferences. E.Firms prefer to pay for many product variations for individual markets despite the sharp increase in costs.

E.Firms prefer to pay for many product variations for individual markets despite the sharp increase in costs.

An upscale hotel chain is developing a global marketing strategy to expand into foreign markets. Which market segment should be​ targeted? A.Middle-class families B.Entire Asian and European countries C.Young people D.Senior citizens E.Frequent business travelers

E.Frequent business travelers

Which type of strategy involves centralized coordination and control of different international​ operations? A.Countertrade strategy B.Transnational strategy C.Multidomestic strategy D.Home replication strategy E.Global strategy

E.Global strategy

________ refer(s) to the legal importation of genuine products into a country by intermediaries other than authorized distributors​ (also known​ as parallel imports). A.Adaptation B.Market segmentation C.International price escalation D.Tariffs E.Gray market activity

E.Gray market activity

A huge MNE was the victim of creeping expropriation from a foreign government. Why is creeping expropriation ethically​ wrong? A.It takes place when MNEs decide to invest. B.It goes into effect while the MNE is planning to expand its operations in a country. C.It takes effect after the MNE improves product distribution throughout the country. D.It occurs before the MNE agrees to move its operations overseas. E.It occurs after an MNE makes large investments in a​ country's property and facilities.

E.It occurs after an MNE makes large investments in a​ country's property and facilities.

​________ occurs when one party files a lawsuit against another. A.Arbitration B.Mediation C.Reconciliation D.Conciliation E.Litigation

E.Litigation

Which of the following is an internal factor that affects international​ pricing? A.Competitor pricing B.Customer expectations C.Taxes and tariffs D.Competitor prices E.Management's market share expectations

E.Management's market share expectations

Which term refers to acquiring certain​ value-chain activities, including the production of finished products from independent​ suppliers? A.Microfinancing B.Purchasing power C.Conglomeration D.Privatization E.Outsourcing

E.Outsourcing

Which challenge of emerging markets is associated with corruption and weak legal frameworks that discourage business​ investments? A.Lack of qualified local partners B.Lack of physical infrastructure C.Excessive bureaucracy D.Dominance of family conglomerates E.Political instability

E.Political instability

Which one of the following is a major factor in the growth of global commerce and in rising incomes​ worldwide? A.Reducing subsidies B.Increasing countervailing duties C.Reducing investment incentives D.Increasing antidumping duties E.Reducing trade barriers

E.Reducing trade barriers

​________ involves countries establishing agreements with one another for the purpose of minimizing obstacles concerning trade and business ventures. A.The General Agreement on Tariffs and Trade B.A foreign trade zone C.Investment motivation D.Centralized economic planning E.Regional economic integration

E.Regional economic integration

It has recently been found that special interest groups​ (SIGs) have unprecedented access to politicians through social events. Why should companies be concerned with the​ SIGs' access to government​ officials? A.SIGs exercise control over activities to prevent terrorism. B.SIGs do not represent small businesses. C.SIGs represent only one side of the political arena. D.SIGs limit intellectual property protection. E.SIGs influence elected officials who can change policy.

E.SIGs influence elected officials who can change policy.

In emerging​ markets, why do successful firms develop close community​ relationships? A.To target political systems in developing markets B.To collaborate with family conglomerates C.To challenge developing market rivals D.To locate quality and accessible business partners E.To better understand local​ conditions, and earn customer respect and loyalty

E.To better understand local​ conditions, and earn customer respect and loyalty

In​ a(n) ________, the headquarters of a company has significant authority and control over the​ company's global activities. A.export department B.international division structure C.decentralized approach D.global approach E.centralized approach

E.centralized approach

In​ a(n) ________, barriers to trade within a participating country are reduced or​ eliminated, shared external barriers are​ established, and unrestricted movement of​ goods, services, and factors of production is permitted. A.customs union B.unrestricted trade location C.free trade area D.overseas trade region E.common market

E.common market

Global branding increases a​ firm's ________ in international markets. A.low-cost strategy B.global sourcing C.product quality D.adaptation E.competitive advantage

E.competitive advantage

A large and highly diversified company that is privately owned is known as​ a(n) ________. A.global sourcing company B.new global challenger C.emerging competitor D.outsourcing company E.family conglomerate

E.family conglomerate

The World​ Bank, the World Trade​ Organization, and the United Nations Conference on Trade and Development are examples of​ ________. A.competing firms B.special interest groups C.regional trade organizations D.governments E.international organizations

E.international organizations

A​ ________ strategy is an approach to internationalization in which company headquarters provides substantial independence to its country​ managers, allowing them to operate independently and pursue local responsiveness. A.transnational B.countertrade C.global D.home replication E.multidomestic

E.multidomestic

A government policy or procedure that restricts trade through means such as quotas is known as​ a(n) ________. A.import control B.import license C.export control D.currency control E.nontariff trade barrier

E.nontariff trade barrier

In​ Iran, systems are based on spiritual​ beliefs, ethical​ codes, and moral standards that are directed by a supreme being. Iran operates under​ ________. A.a mixed system B.civil law C.the rule of law D.common law E.religious law

E.religious law

Products that have universal specifications are the best candidates for​ __________ of its marketing program. A.global sourcing B.adaption C.customization D.outsourcing E.standardization

E.standardization

MNEs must set prices appropriate for local conditions. Many firms devise innovative products and packaging to keep prices low. True False

True

Political instability is associated with corruption and weak legal frameworks that discourage inward investment and the development of a reliable business environment. True False

True

Regional integration greatly increases the scale of the marketplace for firms inside the economic bloc. True False

True

Tariffs and most nontariff trade barriers impact importers by making products more expensive. True False

True