Principles of Management Test 3 [Ch.5+6] - Loes

What is meant by decline?

The product life cycle stage marked by decreases in the product's market share

What is a multinational corporation (MNC)?

A corporation, such as IBM, ExxonMobil, and Nestlé, that operates on a worldwide scale, without significant ties to any one nation or region

What is the World Trade Organization (WTO)?

A global association of member countries that promotes free trade

Which of the following characteristics relates to global business (globalization)?

A strategy in which organizations treat the entire world or major regions of it as the domain for conducting business

Which of the following characteristics relates to contingency plans?

Alternate courses of action to be undertaken if certain organizational or environmental conditions change

What term describes the agreement between ten Southeast Asian countries with the goal to promote economic growth and overall progress in the area via trade and security?

Association of Southeast Asian Nations

You are the international marketing manager for Checker Burger, Inc., producer of a popular soy burger. There is an excellent market for your burgers in the republic of East Slabovia, a producer of high-quality brandy. The only problem is that East Slaboviar currency is not accepted on the international currency exchange. What can you do to help your trade?

Barter burgers for brandy.

Which of the following refers to the initial stage of the product life cycle when the product is introduced?

Birth

What term describes a group of firms or nations that agree to act as a monopoly and not compete with each other?

Cartel

What name is given to a business strategy in which the strategic business unit offers a unique good or service to a customer at a premium price?

Differentiation

What term describes the purchase of overseas production and marketing facilities, in which a company may control the facilities outright, or it may be the majority stockholder in the company that controls the facilities?

Direct Investment

What term describes what a firm does well relative to its competitors?

Distinctive competence

Which of the following characteristics relates to the World Bank?

Established and supported by the industrialized nations in 1946 to loan money to underdeveloped and developing countries

Which of the following refers to an economic and political union of 28 member nations that are located primarily in Europe?

European Union (EU)

What term describes restrictions on the amount of a particular currency that may be bought or sold?

Exchange controls

The ratio at which one nation's currency can be exchanged for another nation's currency or gold is the

Exchange rate

What name is given to the sale of goods and services to foreign markets?

Exporting

Which of the following characteristics relates to countertrade agreements?

Exporting that involves bartering products for other products instead of for currency

What name is given to a form of licensing in which a company agrees to provide a name, logo, methods of operation, advertising, products, and other elements associated with the company's business, in return for a financial commitment and the agreement to conduct business in accordance with the company's standard of operations?

Franchising

What name is given to the final result that a firm wishes to achieve?

Goal

What are strategic goals?

Goals set by higher managers that deal with such general topics as the firm's growth, new markets, or new goods and services

Which of the following refers to the market value of a nation's total output of goods

Gross domestic product (GDP)

What term is used to describe the product life cycle stage characterized by dramatic increases in the product's market share?

Growth

_____ of a plan is where the organization goes from the "thinking" mode to the "doing" mode.

Implementation

The basic mission of which of the following is to oversee the international monetary system and help ensure stable currencies and exchange rates throughout the world?

International Monetary Fund (IMF)

Which of the following refers to the buying, selling, and trading of goods and services across national boundaries?

International business

What name is given to the product life cycle stage when the product's market share either slows or has no growth?

Maturity

Which of the following refers to a definition of an organization's fundamental purpose and its basic philosophy?

Mission

What term is used to describe a formal written declaration of the organization's mission that often includes the firm's philosophy, its primary products and markets, the intended geographic scope, and the nature of the relationships between the firm, its stakeholders, and society?

Mission statement

Which of the following characteristics relates to dumping?

Occurs when a country or business firm sells products at less than what it costs to produce them

What term describes an international economic organization comprised of 30 countries that accept the basic principles of free-market economies and representative democracy, and that recommend and promote policies to improve the well-being of consumers and societies across the world?

Organization of Economic Cooperation and Development (OECD)

What name is given the transfer of manufacturing or other functions (such as data processing) to countries where labor and supplies are less expensive?

Outsourcing

Which of the following refers to a set of activities intended to achieve goals, whether for an entire organization, department, or an individual?

Plan

What name is given to the maximum number of units of a particular product that may be imported into a country?

Quota

What name is given to the evaluation of the organization's internal strengths and weaknesses and the opportunities and threats associated with the business's external environment?

SWOT Analysis

Which of the following refers to a partnership formed to create competitive advantage on a worldwide basis?

Strategic alliance

Which of the following refers to a general statement of actions an organization intends to take or is taking that is based on the fit of the organization with its external environment?

Strategy

Which of the following characteristics relates to the product life cycle?

The cycle of birth, growth, maturity, and decline of a product

What is meant by importing?

The purchase of goods and services from a foreign source

What is meant by corporate strategy?

The scope and resource deployment components of strategy for the enterprise as a whole

What is an embargo?

The suspension of trade in a particular product by the government

Which of the following refers to the acquisition of goods in one country and the selling of them to buyers in another country?

Trading company

You are the president of Henry Motor Corp., and you see the great potential markets in Eastern Europe for personal transportation. Your plan is to purchase an old Soviet tank plant and convert it into an auto factory. The Russian government welcomes your plan, which is an example of

a direct investment.

In SWOT analysis, an ability or attribute that a company possesses that may give it a distinctive competence is called

a strength.

China's arrangement with the Congo to barter infrastructure in exchange for metals is an example of a

countertrade agreement.

According to the text, a blueprint of acceptable behavior that is passed from one generation to the next is called

culture

The first step in strategic planning is

determining the mission and strategic goals.

When a firm offers a unique good or service to a customer at a premium price, it is following the business-level strategy of

differentiation.

Which of the following refers to a tax levied by a nation on goods bought outside its borders and imported into the country?

import tariff

The purchase of goods and services from a foreign source defines

importing

You are an apple farmer and spokesperson for the American Apple Association. You are faced with severe dumping from apple growers in Transoceania, where apples grow wild and the people pay to pick apples as a form of recreation. To counter this threat, you are going to lobby Congress and the president to

impose a protective import tariff.

When Weseeyu, Inc., of Rochester, New York, sells contact lenses to people in Moscow, Russia, the company

is exporting the lenses.

You are the producer of Western Denim brand blue jeans. The pants are in high demand in Pangia; however, shipping costs, tariffs, and trade restrictions are insurmountable. As a last resort, you have entered into an agreement to let a local Pangian manufacturer use your name, materials, and trademark to produce the jeans in exchange for a royalty. This is a

licensing agreement.

You are the executive vice president of Banana Computer, Inc. You have a competitive machine, but your major competitor has the benefit of large-scale production, making its products less expensive to manufacture. In order to remain price-competitive, you send your parts and subassemblies to Mexico for the final stage of assembly, thereby taking advantage of

outsourcing.

The translation of product names can be a crucial factor in the success or failure of a foreign marketing effort because of

sociocultural differences.