INB 300 Chapter 1

BRIC is an acronym for the emerging economies of _____.

Brazil, Russia, India, and China

Which of the following is true of emerging economies?

Collectively, they command 48 percent of world trade.

Which of the following describes international business?

Firms engaging in business abroad

_____ is the sum of value added by residents, households, and government operating in an economy.

GDP

Which of the following was a consequence of rapid globalization in the 1990s and 2000s?

It caused some factions in emerging economies to complain against the onslaught of multinational enterprises (MNEs).

Which of the following statements is true of the second tier of the global economy pyramid?

It consists of a billion people making $2,000 to $20,000 a year.

Which of the following statements is true of the rapid globalization in the 1990s and the 2000s?

It created fear among many people in developed economies that they would lose jobs.

Which of the following statements is true of international premium?

It is a significant pay raise a manager gets when working overseas.

Which of the following statements is true of purchasing power parity (PPP)?

It is an adjustment to reflect the differences in cost of living among different countries.

Which of the following statements is true of the base of the pyramid?

It is ignored by most of the multinational enterprises.

Which of the following statements is true of semiglobalization?

It is more complex than extremes of total isolation and total globalization.

According to the pendulum view on globalization, which of the following statements is true of globalization?

It is not one-directional.

Which of the following statements is true of foreign direct investment?

It is the process of investing in, controlling, and managing value-added activities in other countries.

Which of the following statements is true of semiglobalization?

It is to be engaged.

Which of the following statements is true of the study of global business?

It is very interdisciplinary.

MaltHanks Inc., a leading American firm, starts its operations in China. It incurs a lot of additional costs in comparison to the local firms. These costs originate in limited local knowledge and local stakeholders' discriminatory attitudes. Which of the following best describes the problem faced by MaltHanks?

Liability of foreignness

_____ is the inherent disadvantage that firms from other countries experience in host countries because of their nonnative status.

Liability of foreignness

Which of the following is a difference between risk management and scenario planning?

Risk management is the identification and assessment of risks, whereas scenario planning is a technique to prepare and plan for multiple situations.

Which of the following is a reason that expats are often hired away by competitor firms?

The competitor firms are interested in globalizing their business by using expat expertise.

Which of the following statements is true of expatriate managers?

They are managers who work abroad.

Which of the following statements is true of the emerging economies?

They attract 60 percent of foreign direct investment (FDI) inflows and generate 40 percent FDI outflows.

Which of the following statements is true of foreign firms?

They do not dominate nonnative markets.

Which of the following statements is true of institutions?

They mean the formal and informal rules of the game.

The _____ consists of North America, Western Europe, and Japan.

Triad

According to one of the three views of globalization, globalization is _____.

a process similar to the swing of a pendulum

More than 25 percent of global gross domestic product (on a PPP basis) in recent years comes from _____.

emerging economies, such as BRICS (Brazil, Russia, India, China, and South Africa)

According to the Pendulum view on globalization, globalization is very recent and one-directional.

false

Formal institutions include culture, ethics, and values.

false

LindaLoel Corp. extensively uses the technique of scenario planning. Scenario planning is the identification and assessment of risks and the preparation to minimize the impact of high-risk, unfortunate events.

false

According to the pendulum view on globalization, _____ existed for more than two millennia, with earliest traces discovered in Phoenician, Assyrian, and Roman times.

multinational enterprises

A(n) _____ is a leading perspective in global business that suggests that firm performance is, at least in part, determined by its internal capital and capabilities.

resource-based view

Which of the following expression does the author use to describe globalization in the recent times?

semiglobalization

Most emerging economies have experienced:

some significant slow down recently.

Croulene Corp, an American company, starts its operations in China. Croulene has an inherent disadvantage in China because of its nonnative status. This is an example of a liability of foreignness.

true

George and John are both managers at Routen Plan Inc. based in Washington, but only George receives a significant international premium compensation as he is an expatriate manager of Routen Plan, Germany.

true

Individuals who make less than $2000 a year comprise the base of the pyramid (BoP).

true

SchulzRobb Inc., a company based in England, engages in foreign direct investment in other countries such as India, Japan, and Brazil. SchulzRobb is a multinational enterprise.

true

Semiglobalization suggests that barriers to market integration at borders are high, but not high enough to insulate countries from each other completely.

true

The goal of the CEO of the new East India Company was to unlock and strengthen the potential value of the world's first multinational.

true

The old East India Company is a household name because of its political abilities to leverage and control the rules of the game around the world.

true