MGT 5632 Test 1

Because culture is not directly observable, it is a) best ignored in foreign sales, to avoid mistakes. b) best learned about by observation of how it manifests itself. c) likely to be impossible to comprehend. d) best studied through language, since language is closest to culture.

best learned about by observation of how it manifests itself. Explanation: Culture is best studied through its manifestations, the social world in which it exists.

which is the most appropriate driver of globalization for the following New businesses, many from newly industrialized and developing countries, have entered world markets. a) political drivers b) technological c) market d) cost e) competitive

competitive

Deals that do not result in a foreign investor obtaining at least ________ of the shareholdings are classified as portfolio investments. a) 25 percent b) 50 percent c) 10 percent d) 100 percent

10 percent Explanation: Deals that do not result in the foreign investor's obtaining at least 10 percent of the shareholdings are classified as portfolio investments.

When Georgio accepted a job in the U.S.-based subsidiary of his Spanish multinational company, he was surprised to learn that wage rates were a) lower than the national average. b) 30 percent higher than the national average. c) double the national average. d) equal to the national average.

30 percent higher than the national average. Explanation: Additional jobs have been created by foreign investment linked to the globalization of markets and trade, with many of these new jobs being well-compensated. Indeed, wage rates in U.S.-based subsidiaries of foreign multinationals are about 30 percent above the national average.

Environment a) Forces originating in the home country that surround and influence b) Internal forces that management administers to adapt to changes in external force c) Either a global or a multidomestic company d) All the forces influencing the life and development of the business

All the forces influencing the life and development of the business

International Business a) Business whose activities are carried out across national borders b) Forces originating outside the home country that surround and influence the business c) Unconscious reference to your own cultural values when judging behaviors in a new and different environment d) Either a global or a multidomestic company

Business whose activities are carried out across national borders

The three nations that exported the largest amount of goods to the United States in 2017 were a) China, Mexico, and the United Kingdom. b) China, Canada, and Mexico. c) China, Japan, and Saudi Arabia. d) Canada, Mexico, and Japan.

China, Canada, and Mexico. Explanation: Figure 2.2 shows the major trading partners of the United States. China, Canada, and Mexico were the largest sources of U.S. imports of goods.

Which Driver does the following scenario fall under? Companies are exporting or producing overseas to capitalize on economies of scale in R&D, production, inventory costs, and so on. a) Cost b) technological c) political d) market e) competitive

Cost

Which of the elements in Porter's diamond model of national advantage takes into consideration the sophistication of a company's customers? a) Demand conditions b) Factor conditions c) Export conditions d) Government

Demand conditions Explanation: Demand conditions refer to the nature of domestic demand matters, rather than merely the size. If a firm's customers are sophisticated and demanding, the firm will strive to produce high-quality and innovative products and, in doing so, will obtain a global competitive advantage over companies located where domestic pressure is less.

International Company a) Forces originating in the home country that surround and influence b) Internal forces that management administers to adapt to changes in external force c) Either a global or a multidomestic company d) All the forces influencing the life and development of the business

Either a global or a multidomestic company

Of the arguments against globalization which matches the following? To comply with NAFTA's rules on trade in services, the Bush administration waived U.S. clean air standards which allowed trucks based in Mexico to haul freight on U.S. highways. a) Results across nations and people b) Environment and Health c) Trade creates new jobs, and these tend to be better than the old ones. d) jobs e) Socioeconomic development f) Labor and labor standards

Environment and Health

How are exchange rates used in international trade? a) Exchange rates set the costs of labor. b) Exchange rates indicate which products create an absolute advantage for trading partners. c) Exchange rates are used to devalue property in exchange for goods. d) Exchange rates are used to convert from foreign to domestic currency.

Exchange rates are used to convert from foreign to domestic currency. Explanation: To determine whether it is more advantageous to buy locally or to import, the traders need to know the prices in their own currencies. To convert from foreign to domestic currency, they use the exchange rate.

Uncontrollable Forces a) External forces over which management has no direct control b) Operations of a company outside its home or domestic market c) Interaction between domestic and foreign forces or between sets of foreign environmental forces d) Forces originating in the home country that surround and influence the business's life and development

External forces over which management has no direct control

Domestic Environment a) External forces over which management has no direct control b) Operations of a company outside its home or domestic market c) Interaction between domestic and foreign forces or between sets of foreign environmental forces d) Forces originating in the home country that surround and influence the business's life and development

Forces originating in the home country that surround and influence the business's life and development

What denotes the operations of a company outside its home or domestic market; many refer to this as business conducted within a foreign country?

Foreign business

Hall suggests that communication tends to be implicit and indirect in a) low-context cultures. b) Australia. c) the United States. d) high-context cultures.

Hall suggests that communication tends to be implicit and indirect in Explanation: In a high-context culture, much communication is conveyed by context rather than direct verbal interaction. It tends to be implicit and indirect.

International Environment a) External forces over which management has no direct control b) Operations of a company outside its home or domestic market c) Interaction between domestic and foreign forces or between sets of foreign environmental forces d) Forces originating in the home country that surround and influence the business's life and development

Interaction between domestic and foreign forces or between sets of foreign environmental forces

Controllable Forces a) Forces originating in the home country that surround and influence b) Internal forces that management administers to adapt to changes in external force c) Either a global or a multidomestic company d) All the forces influencing the life and development of the business

Internal forces that management administers to adapt to changes in external force

What form of business I is carried out across international borders?

International business

Of the arguments against globalization which matches the following? The promise of export-led growth has failed to materialize in some parts of the world, especially in parts of Latin America and sub-Saharan Africa. a) Results across nations and people b) Environment and Health c) Trade creates new jobs, and these tend to be better than the old ones. d) jobs e) Socioeconomic development f) Labor and labor standards

Results across nations and people

Of the arguments against globalization which matches the following? Developed nations with more rigorous labor standards become disadvantaged as jobs move to developing nations with lower standards. a) Results across nations and people b) Environment and Health c) Trade creates new jobs, and these tend to be better than the old ones. d) jobs e) Socioeconomic development f) Labor and labor standards

Labor and labor standards

____________ time is linear and divisible into blocks, reflecting an economic approach.

Monochronic

Monochronic time is best illustrated by a) the multitude of activities required by new parents. b) the flight schedule at an airport. c) on-duty nurses' roles in an emergency room. d) a rock concert.

Monochronic time Explanation: Monochronic time is linear and divisible into blocks, reflecting an economic approach.

Foreign Business a) External forces over which management has no direct control b) Operations of a company outside its home or domestic market c) Interaction between domestic and foreign forces or between sets of foreign environmental forces d) Forces originating in the home country that surround and influence the business's life and development

Operations of a company outside its home or domestic market

Which of the elements in Porter's diamond model of national advantage takes into consideration companies that locate near the suppliers they need to produce their product? a) Factor conditions b) Demand conditions c) Firm strategy, structure, and rivalry d) Related and supporting industries

Related and supporting industries Explanation: Related and supporting industries: Firms in an industry, with their suppliers, their suppliers' suppliers, and so forth, tend to form a cluster in a given location, providing a network of suppliers and subcontractors and a commercial infrastructure.

Of the arguments against globalization which matches the following? Free trade is the best strategy for advancing the world's economic development. a) Results across nations and people b) Environment and Health c) Trade creates new jobs, and these tend to be better than the old ones. d) jobs e) Socioeconomic development f) Labor and labor standards

Socioeconomic development

The fact that almost everyone in the United States self-identifies as middle class suggests that the United States a) measures low on the power distance dimension. b) the economy has failed to support an aristocracy. c) is a successful meritocracy. d) measures low on the uncertainty avoidance dimension.

The fact that almost everyone in the United States self-identifies as middle class suggests that the United States Explanation: Power distance is a measure of social inequality; it focuses on how much inequality seems right. The United States measures low on this dimension.

Who is credited with being the first person to coin the term "globalization?" a) Peter Drucker b) John Keynes c) Theodore Levitt d) Stephen Covey

Theodore Levitt Explanation: Theodore Levitt is credited with being the first person to coin the term "globalization."

Self-reference Criterion a) Business whose activities are carried out across national borders b) Forces originating outside the home country that surround and influence the business c) Unconscious reference to your own cultural values when judging behaviors in a new and different environment d) Either a global or a multidomestic company

Unconscious reference to your own cultural values when judging behaviors in a new and different environment

What is the COVAX initiative? a) a collaboration of nations to develop and disperse vaccines for COVID-19 Correct b) a U.S.-funded plan to increase exports until there is a balance of trade c) a World Bank program supporting developing nations d) a United Nations program mandating that countries that receive financial support must meet specific goals

a collaboration of nations to develop and disperse vaccines for COVID-19 Explanation: The COVAX initiative involved the collaboration of over 170 nations to help develop and disperse vaccines at an unprecedented speed and scale to address the COVID-19 pandemic and to facilitate equitable access to treatment for populations in less prosperous nations of the world.

E. T. Hall suggests that to learn another culture, you have to undergo extensive training or spend a) a considerable time and money taking guided tours in the other culture. b) time studying the language of the other culture. c) considerable time with people of the other culture, but perhaps outside that culture. d) a lifetime in the other culture.

a lifetime in the other culture. Explanation: Hall suggested that there are two ways to learn another culture: either spend a lifetime within a culture or undergo an extensive training program on the culture.

Tariffs placed on products from another country may bring in more money to the government of the country that initiated the tariffs, but they may hurt consumers in that country in the form of higher prices for goods. This demonstrates how forces in the foreign environment a) have different values. b) can be difficult to assess. c) are interrelated. d) are unique.

a) have different values. Explanation: Even though the kinds of forces in the two environments are identical (tariffs), their values often differ widely, and at times they are completely opposed to each other.

Supporters of mercantilism would agree that a) more than one nation can maintain a comparative advantage. b) accumulation of precious metals is an activity essential to a nation's welfare. c) industrial development is the primary source of a nation's wealth. d) trade policies that generally benefited consumers and emerging industrialists should be promoted.

accumulation of precious metals is an activity essential to a nation's welfare. Explanation: Supporters of mercantilism viewed precious metals such as gold and silver as the only source of wealth, and their accumulation as essential to a nation's welfare.

James realized the company's marketing materials should avoid the color red in South Africa because it is the color of mourning in that country. What part of culture is James taking into consideration? a) gift-giving b) spoken language c) stereotypes d) aesthetics

aesthetics Explanation: Aesthetics reveal a country's sense of beauty and taste.

The music and folklore associated with society is one way to communicate a culture's a) finance. b) aesthetics. c) language. d) religion.

aesthetics Explanation: Music and folklore communicate a culture's aesthetics.

Material culture includes a) all human-made objects. b) the makers of things but not those who use them. c) only things that are used in production processes. d) all textiles and fabrics.

all human-made objects. Explanation: Material culture includes all things people make, including who makes them, why they make them, and how.

According to the theory of comparative advantage, trade can benefit if... a) both countries involved in a trade. b) the importing country involved in a trade. c) the exporting country involved in a trade. d) neither country is involved in a trade.

both countries involved in trade. Explanation: British economist David Ricardo demonstrated in 1817 that even though one nation held an absolute advantage over another in the production of each of two different goods, international trade could still be a positive-sum game in which both countries benefit.

Most multinationals are based in ________blank countries, but recently there has been a surge in the number arising in ________blank countries. a) underdeveloped; developing b) developed: underdeveloped c) developed; emerging d) emerging; underdeveloped

c) developed; emerging Explanation: While most multinationals are based in the developed nations of the world, recently there has been a surge in the number arising in emerging economies.

Which of these is considered an external environmental force? a) human resources b) production c) competition d) marketing

competition

Which Driver does the following scenario fall under? Competition continues to increase in intensity with new firms entering global markets. a) Cost b) technological c) political d) market e) competitive

competitive

Which Driver does the following scenario fall under? The rush to globalization has resulted in explosive growth in international business. a) Cost b) technological c) political d) market e) competitive

competitive

new entrants Is a general characteristic of which driver a) political drivers b) technological c) market d) cost e) competitive

competitive

An automobile manufacturer decided to enter the European market because if it didn't, then all of the other car companies that were already there would get the business. Which driver is causing internationalization for the manufacturer? a) market b) cost c) political d) competitive

competitive Explanation: Since competition continues to increase in intensity, companies are having to respond to this and determine if they should enter the international market.

Environment involves the forces surrounding and influencing the life and development of the firm and is classified as a) domestic and foreign. b) controllable and uncontrollable. c) representative and democratic. d) primary and secondary.

controllable and uncontrollable. Explanation: International business differs from domestic business in that a firm operating across borders must deal with the forces of three kinds of environments—domestic, foreign, and international. In contrast, a firm whose business activities are carried out within the borders of one country needs to be concerned essentially with only the domestic environment.

Which Driver does the following scenario fall under? Businesses can move production or other parts of the value chain business to countries where costs are lower. a) Cost b) technological c) political d) market e) competitive

cost

economies of scale Is a general characteristic of which driver a) political drivers b) technological c) market d) cost e) competitive

cost

which is the most appropriate driver of globalization for the following Economies of scale reduce costs per unit a) political drivers b) technological c) market d) cost e) competitive

cost

The purchase of an existing business in another nation is known as a a) cross-border acquisition. b) greenfield investment. c) strategic alliance. d) home country expansion.

cross-border acquisition. Explanation: The purchase of an existing business in another nation is known as a cross-border acquisition.

A nation that is struggling to remain competitive in the world market may decide to reduce the value of the country's currency relative to other currencies. This process is called currency a) surplus. b) devaluation. c) deficit. d) customization.

devaluation. Explanation: This example suggests that a nation can attempt to regain competitiveness in world markets through currency devaluation, which lowers the value of a nation's currency relative to other currencies and therefore effectively lowers the prices of its exports.

A major portion of the exports from developing countries go to ________ countries; this proportion has been ________. a) developed; increasing b) developing; increasing c) developed; decreasing d) developing; decreasing

developed; decreasing Explanation: A major portion of the exports from developing nations do go to developed countries, but this proportion has declined from 72 percent in 1970 to about 43 percent by 2015 as developing nations participate more extensively in trade with other developing nations.

The two components of foreign investment include portfolio investment and a) exporting. b) importing. c) direct investment. d) government tariffs.

direct investment. Explanation: The distinction between portfolio investments and direct investments has begun to blur, particularly with the growing size and number of international mergers, acquisitions, and alliances in recent years.

Based on the work of Edward Hall, the explicit communicator in a low-context culture is a) direct, unsubtle, and unambiguous: What you say is what you mean. b) ready to act: Communication will happen regardless of cultural differences. c) unprepared and wary: The message is in the context. d) subtle, nuanced and indirect: Meaning accrues through not exactly what is said or done.

direct, unsubtle, and unambiguous: What you say is what you mean. Explanation: The explicit communicator in an LC culture is direct, unsubtle, and unambiguous: What you say is what you mean. There is relatively less subtlety. "Telling it like it is" is understood as a positive trait.

In examining the volume of international trade, the proportion of world exports and imports accounted for by the 10 largest exporting and importing nations in 2016 a) exceeded 50 percent b) was less than 10 percent. c) was approximately one-third. d) was approximately 25 percent.

exceeded 50 percent. Explanation: Table 2.1 presents the world's 10 largest nations in terms of exports and imports of merchandise and of services. The 10 largest exporters and importers collectively account for over half the world's exports and imports.

Nations encounter a trade surplus when the value of a) imports and exports doesn't change. b) exports exceeds the value of imports. c) imports and exports is balanced. d) imports exceeds the value of exports.

exports exceed the value of imports. Explanation: Trade surplus—the amount by which the value of a nation's exports exceeds the value of its imports.

Gentille Manufacturing, based in California, recently purchased a new manufacturing facility and production equipment in Germany that it will use to produce component parts. This purchase is an example of a) importing and exporting. b) economies of scale. c) foreign direct investment. d) intrastate commerce.

foreign direct investment. Explanation: Foreign direct investment refers to direct investments in equipment, structures, and organizations in a foreign country.

International business differs from domestic business in that a firm operating across borders must deal with the forces associated with which three kinds of environments? a) initial, secondary, primary b) geographic, political, economic c) multicultural, ethnocentric, stereotypical d) foreign, domestic, international

foreign, domestic, international Explanation: International business differs from domestic business in that a firm operating across borders must deal with the forces of three kinds of environments—domestic, foreign, and international. In contrast, a firm whose business activities are carried out within the borders of one country needs to be concerned essentially with only the domestic environment.

An opponent of globalization would state that a) globally integrated countries spend more on public education, especially in developing countries. b) globalization has had harmful effects on labor and labor standards. c) countries that have rejected globalization are among the most advanced nations of the world. d) globalization has increased the proportion of people in developing countries who live on $1.25 per day or less.

globalization has had harmful effects on labor and labor standards. Explanation: globalization has had harmful effects on labor and labor standards.

General Motors built a facility in Coahuila, Mexico to produce propulsion systems in 1981. What type of investment does this represent? a) cross-border acquisition b) greenfield investment c) internal investment d) exporting

greenfield investment Explanation: This is a greenfield investment since it was built by GM.

Katerina grew up in eastern Europe but moved to New York after college. Compared to her friends that stayed in Europe, she enjoys much more freedom with her time and is able to enjoy leisure activities and be active in her career. Which of Hofstede's dimensions does this demonstrate? a) uncertainty avoidance b) masculinity vs. femininity c) pragmatic vs. normative d) indulgence vs. restraint

indulgence vs. restraint Explanation: The dimension of indulgence vs. restraint is about happiness and a culture's tendency to allow relatively free gratification of human desires or suppress human drives.

What is an example of an external force that represents financial factors affecting a business? a) employee salaries b) interest rates c) domestic laws d) geographic location

interest rates Explanation: Interest rates are an example of a financial factor that acts as an external force on a business.

Rhonda grew up in the U.S. and had never really given much thought to climate change, assuming that people could control nature. But then she moved to Sweden, a country that is leading the way in global climate change rankings. Now she believes that it is important to work with the environment, not try to control it. Which of Trompenaars's seven dimensions is described? a) internal vs. external direction b) universalism vs. particularism c) achievement vs. ascription d) specific vs. diffuse

internal vs. external direction Explanation: In internal-direction cultures, people believe they control nature. In external-direction cultures, they believe the natural world controls them and they need to work with their environment.

The theory that to obtain a higher return on its investment, a firm will transfer its superior knowledge to a foreign subsidiary that it controls, rather than sell it in the open market is known as a) dynamic capabilities theory. b) internalization theory. c) internationalization theory. d) strategic behavior theory.

internalization theory. Explanation: The theory that to obtain a higher return on its investment, a firm will transfer its superior knowledge to a foreign subsidiary that it controls, rather than sell it in the open market is known as internalization theory.

The construction industry has joined the ranks of other industries and now carries out business across national borders. In other words, the construction industry has become a(n) a) domestic affiliate. b) international affiliate. c) foreign-owned company. d) international business.

international business. Explanation: An international business is a business that is carried out across national borders.

A bicycle designer and manufacturer is headquartered in Illinois. It does business in the United States and exports to Europe and South America. This company is an example of a(n) a) domestic corporation. b) global partnership. c) international company. d) foreign subsidy.

international company. Explanation: An international company has operations in multiple nations. International companies may not have any investment in nations other than their home nation, which might be the case for a company that is only involved in exporting and selling its goods or services in other nations.

General characteristic of technological driver

internet

Of the arguments against globalization which matches the following? Trade creates new jobs, and these tend to be better than the old ones. a) Results across nations and people b) Environment and Health c) Trade creates new jobs, and these tend to be better than the old ones. d) jobs e) Socioeconomic development f) Labor and labor standards

jobs

The most obvious cultural distinction a company must take into account when deciding to undertake international business is a) finance. b) aesthetics. c) language. d) religion.

language. Explanation: Probably the most obvious and distancing cultural distinction for newcomers to international business is language, both spoken and unspoken.

Which Driver does the following scenario fall under? Businesses can build a direct presence in foreign markets. a) Cost b) technological c) political d) market e) competitive

market

Which Driver does the following scenario fall under? Companies expand abroad to protect their home market by establishing operations where key customers are located or by following large customers into new markets. a) Cost b) technological c) political d) market e) competitive

market

saturated home market Is a general characteristic of which driver a) political drivers b) technological c) market d) cost e) competitive

market

which is the most appropriate driver of globalization for the following Finding that the home market is saturated a) political drivers b) technological c) market d) cost e) competitive

market

An advertising company based in Toronto decided to establish an operation in France because it was concerned that its competition would try to take over its clients in Europe, which represents 65 percent of its business. Which type of driver is responsible for this decision to go international? a) political b) cost c) market d) technological

market Explanation: A company that establishes a foreign operation to maintain the majority of its business is being affected by a market driver.

When a supplier to an original equipment manufacturer (e.g., a battery manufacturer supplying an automobile producer) follows its major customer to a new country, it is an example of a ________ driver of international business activity. a) political technological b) market c) technological d) cost

market Explanation: Suppliers to original equipment manufacturers (battery manufacturers supplying automobile producers) often follow their large customers, reflecting a market driver for internationalization. These suppliers have an added advantage in that they are moving into new markets with a guaranteed customer base.

Compared to 1980, service exports in 2017 can best be described as a) struggling to flourish based on government restrictions. b) decreasing due to more international corporations. c) lower than they were in 1980. d) more than 15 times larger.

more than 15 times larger. Explanation: The level of service exports worldwide grew from $396 billion in 1980 to $6.1 trillion in 2019. This means that services exports in 2019 were 15.5 times larger than they were in 1980.

A global mindset is a set of skills that is evidence of... a) an openness to diversity and an ability to work across cultural borders. b) an ability to think in the big picture. c) an inclination to learn languages quickly and enjoy crossing cultural borders. d) the belief that one's own culture is superior to other cultures.

openness to diversity and an ability to work across cultural borders. Explanation: A global mindset is an openness to diversity along with an ability to pull ideas together across boundaries created by that diversity. This ability to synthesize across diversity requires a willingness to deal with complexity.

The forces in the foreign environment differ from the domestic environment in that they originate a) outside the firm's home country. b) in the firm's home country. c) in only the host country. d) concurrently in the home and host country.

outside the firm's home country. Explanation: The foreign environment refers to all the uncontrollable forces originating outside the home country that surround and influence the firm. The forces in the foreign environment are the same as those in the domestic environment except that they occur outside the firm's home country.

Which Driver does the following scenario fall under? Many businesses have gained access to combined markets by exporting to or producing in the area. a) Cost b) technological c) political d) market e) competitive

political

preferential trade agreements and privatization of industry Is a general characteristic of which driver a) political drivers b) technological c) market d) cost e) competitive

political

which is the most appropriate driver of globalization for the following Preferential trade agreements such as the North American Free Trade Agreement and the European Union a) political drivers b) technological c) market d) cost e) competitive

political

which is the most appropriate driver of globalization for the following Privatization of much of the industry in formerly communist nations a) political drivers b) technological c) market d) cost e) competitive

political

According to the theory of comparative advantage, a nation should a) should produce the goods for which its absolute disadvantage is less. b) should strive to produce trade surpluses to acquire supplies of precious metals. c) must have an absolute advantage in at least one good to gain from trade. d) can gain from trade if it is equally inefficient in producing at least two goods.

produce the goods for which its absolute disadvantage is less. Explanation: The theory of comparative advantage proposes that when one nation is less efficient than another nation in the production of each of two goods, the less efficient nation has a comparative advantage in the production of the good for which its absolute disadvantage is less.

The rise of the Ottoman Empire before 1300 influenced trade as it a) reduced the cost of Asian trade for Europeans. b) reduced the cost of European trade for Asians. c) promoted a search for sea routes from Europe to Asia. d) eliminated trade between Europe and Asia.

promoted a search for sea routes from Europe to Asia. Explanation: The rise of the Ottoman Empire before 1300, ultimately spanning Europe, North Africa, and the Middle East, profoundly influenced the emerging trade routes for people, goods, money, animals, and microorganisms that spanned from England to China, across the Mediterranean and Northern Africa, and through Central Asia and the Indian Ocean region. The powerful central location of the Ottomans within this trading web had the effect of raising the cost of Asian trade for Europeans and thus drove a search for sea routes to Asia, including the expeditions that discovered the Americas.

International business as a business practice is considered a) to have existed before the Roman Empire. b) a result of the rise of the Ottoman Empire. c) to have begun in China in the 18th century. d) relatively new.

relatively new. Explanation: While international business as a discipline is relatively new, as a business practice it is not. Well before the Roman Empire was established, Phoenician and Greek merchants were sending representatives abroad to sell their goods.

Theory based on ________ states that international and interregional differences in production costs occur because of differences in the supply of production factors. a) comparative advantage b) resource endowments c) mercantilist advantage d) absolute advantage

resource endowments Explanation: A theory developed by Eli Heckscher and Bertil Ohlin at the Stockholm School of Economics suggests that differences in resource endowments will make developed countries more likely to trade with developing countries whose resource endowments are likely to be very dissimilar, than with other developed countries whose endowments are similar. According to this theory, countries would export products requiring large amounts of their abundant production factors and import products requiring large amounts of their scarce production factors.

Foreign affiliates must obey local laws. If they don't, they could be subject to a) legal action by the United Nations. b) seizure by the host government.Correct c) legal action by the home country. d) reciprocal behavior by competitor companies.

seizure by the host government. Explanation: Regardless of the parent firm's size, each affiliate is a local company that must comply with the laws in the country in which it is located. If it does not, it can be subject to legal action or even government seizure.

In 2019, what product was included in the five largest categories of U.S. goods exported to China? a) soybeans b) toys c) furniture d) soft goods

soybeans Explanation: In 2019 the five largest categories of U.S. goods exported to China were transportation equipment (e.g., cars, aircraft), computer and electronic products, chemicals, machinery, and agricultural products (e.g., soybeans).

Internet Is a general characteristic of which driver a) political drivers b) technological c) market d) cost e) competitive

technological

Which Driver does the following scenario fall under? Microprocessors, telecommunications advances, and the Internet have fueled changes. a) Cost b) technological c) political d) market e) competitive

technological

which is the most appropriate driver of globalization for the following The Internet and network computing facilitate the rapid flow of information, regardless of physical location, which enables companies to compete globally. a) political drivers b) technological c) market d) cost e) competitive

technological

Jackson Control Corp. now uses videoconferencing which helps the sales team demonstrate products to prospective international customers while eliminating expensive travel costs. Which of the five drivers of international business does this represent? a) political b) market c) competitive d) technological

technological Explanation: Advances in computers and communications technology are permitting an increased flow of ideas and information across borders, enabling customers to learn about foreign goods. Internet videoconferencing allows sellers to demonstrate their products to prospective buyers all over the world without the need to travel. It also permits international companies to hold corporate meetings between managers from headquarters and overseas subsidiaries without expensive, time-consuming travel.

Sankha is the director of operations for Farm Fresh Produce Corp. and is now able to sell his product to the international market thanks to a new computer system that is specifically designed for businesses in the fresh food industry. Which driver helped Sankha's company internationalize? a) market b) cost c) technological d) political

technological Explanation: Technological drivers include advances in computers and communication technology that permit an increased flow of ideas and information across borders.

In Trompenaars's universalism-particularism dimension, people in particularist cultures a) tend to be rule-based. b) tend to be relationship-based. c) apply rules to all people at all times. d) rarely have misunderstandings about ethics.

tend to be relationship-based. Explanation: People in universalist cultures apply rules to all people at all times, without exception. People in particularist cultures consider the context before they apply the rule. They tend to be relationship-based.

Loose versus tight accounting controls directly relate to a culture's assumptions about a) efficiency. b) the basic nature of people.Correct c) inventory policy. d) leadership.

the basic nature of people. Explanation: Tight controls imply a low level of trust while looser controls imply a higher level of trust.

Referring to Hall's high- and low-context framework, in a high-context culture a) the context carries much of the communication. b) the context is irrelevant. c) communication is direct and focused on the topic. d) communication is explicit.

the context carries much of the communication. Explanation: In a high-context culture, context carries much of the communication, so the communication tends to be more subtle and indirect than in a low-context culture.

Trompenaars's particularist dimension describes a culture in which a) rules rather than relationships regulate behaviors. b) the judgment of something depends on the situation. c) all rules apply to all people at all times. d) rules never apply.

the judgment of something depends on the situation. Explanation: In particularist cultures, particular circumstances matter when rules are applied.

The rapid expansion of world exports in the last 40 years demonstrates that a) domestic businesses cannot compete with cheap imports. b) the opportunity to increase sales by exporting is a viable growth strategy. c) businesspeople can expect to meet lower levels of competition in their domestic markets. d) jobs will inevitably decline in developed countries due to import competition.

the opportunity to increase sales by exporting is a viable growth strategy. Explanation: The rapid expansion of world exports since 1980 demonstrates that the opportunity to increase sales by exporting is a viable growth strategy and one that can benefit the exporting nations by creating jobs for their citizens. At the same time, however, the growth of exports from individual nations should be a warning to managers that they must be prepared to meet increased competition from these exports in their own domestic markets.

The experience curve refers to a) the rising scale on which efficiency improves as a result of cumulative experience and learning. b) the plateau stage in the product life cycle where companies export products for the first time. c) the sloping curve that designates the end of the product life cycle. d) the predictable decline in the average cost of producing each unit of output as a production facility gets larger and output increases.

the rising scale on which efficiency improves as a result of cumulative experience and learning. Explanation: Experience curve refers to the rising scale on which efficiency improves as a result of cumulative experience and learning.

In Trompenaars's ascription culture, a person's identity is based on a) their family lineage, age, or other attributes. b) their work achievements. c) cultural norms. d) educational diversity.

their family lineage, age, or other attributes. Explanation: Ascription cultures consider a person's identity in terms of his or her family lineage, age, or other attributes.

One danger of using the culture frameworks introduced in Module 3 is applying them predictively because a) we'll enrich our perceptions. b) they ignore complexity and subtlety. c) we'll be able to understand too much detail of a culture, and this will slow down decision-making. d) our understanding of culture will be complex and obstruct decision-making.

they ignore complexity and subtlety. Explanation: The generalizations represented in the frameworks are at best sophisticated stereotype of the complex cultures we are trying to understand. They are useful as first guesses; as predictions, however, they can mislead because they ignore complexity and subtlety.

Latrell decided not to take the overseas management position because he knew managers worked alongside their staff and did not have private offices in this particular international culture. He thought this made managers look less important and inconsequential. What aspect of culture is he concerned with? a) folklore b) verbal communication c) unspoken language d) aesthetics

unspoken language Explanation: Unspoken language includes spatial relationships, such as office size and location.