IB Final Questions
Which of the following is characteristic of cross-border contractual relationships?
When compared to FDI, they are less susceptible to volatility and risk, and tend to bring both parties a predictable stream of revenue.
Which of the following is a trend seen in the modern international economy?
Firms from both advanced and emerging economies employ FDI.
When a firm allows others to use an entire business system in exchange for compensation, the arrangement is known as
Franchising
Which of the following is the most likely source for foreign market information, assessments, and statistics?
U.S. Department of Commerce
Which of the following is an example of intellectual property?
Volkswagen's logo
________ is the process of dividing the firm's total customer base into homogeneous clusters in a way that allows management to formulate unique marketing strategies for each group.
Market Segmentation
In which of the following are substantial autonomy and decision making authority delegated to a firm's subsidiaries around the world?
decentralized approach
After managers have chosen an appropriate market for exporting, the next step is to ________.
decide about the resources to be committed.
Which of the following should be done by a company planning to internationalize when it assesses market industry potential?
develop a 3-to-5-year forecast of industry sales for each target market
A firm that pursues foreign direct investment to take advantage of government incentives is demonstrating a(n) ________ motive.
efficiency-seeking
When developing strategies, managers start by:
examining the firm's specific strengths and weaknesses
Which of the following is an example of a multidomestic industry?
fashion
An arrangement in which the firm allows another the right to use an entire business system in exchange for fees, royalties, or the forms of compensation is known as_________.
franchising
If a computer contains a microprocessor from Costa Rica and a hard disk drive from the Philippines, the computer manufacturer, who is based in Texas and operates across Europe and West Asia, most likely uses ________ as an entry strategy.
global sourcing
In international business, firms frequently formulate market segments by ________.
grouping countries based on macro-level variables
Which of the following best characterizes the purpose of a global marketing strategy?
guides firms in targeting the right customer segments
A firm that owns the activities performed in a single stage of its value chain is demonstrating ________.
horizontal integration
In establishing a firm's organizational structure, a fundamental issue is ________.
how much decision-making responsibility the firm should retain at headquarters
In international business, marketing is concerned with ________.
identifying, measuring, and pursuing customer needs and market opportunities abroad
An industrial design is intended to ________.
improve a product's performance and marketability
Firms that emphasize global integration make and sell ________.
products that require minimal adaptation
The level of taxes in a country is a part of the ________ factor that is considered when selecting an FDI location.
profit retention
The Internet facilitates international trade in the service sector by ________.
providing the means to export some types of services to foreign markets
Business activities that would most likely be offshored are characterized by ________.
routine tasks that do not relate to the firm's primary service or product
Which of the following must be considered in selecting foreign direct investment locations?
tax rates for profit repatriation; rate of inflation; stability of currency
A country's population is referred to as__________.
market size
The term industry market potential can best be defined as the ____.
predicted industry sales over a particular period of time
Which of the following is a primary question to ask when attempting to determine a product's potential in a foreign market
Why do people buy the product?
In a licensing agreement, the licensee provides ________.
a combination of down-payment plus royalty
Which of the following is provided by the licensor in a licensing agreement?
a combination of intellectual property and technical information and assistance
Which of the following best describes an expatriate?
an employee who is assigned to live and work in a foreign country for an extended period
The pattern or geographic arrangement of locations where the firm carries out value-chain activities is known as ________.
configuration of value-adding activity
A(n) ________ is a project-based, usually nonequity venture initiated by multiple partners to fulfill a large-scale project.
consortium
The size and growth rate of a country's middle class is termed as______
market consumption capacity
Which of the following dimension refers to the buying power of the country's residents?
market intensity
Which of the following is an example of licensing?
An American electronics firm has given the right to a new process for manufacturing e-book readers to an electronics manufacturer in Canada.
Which of the following is considered a regional hub?
Hong Kong
________ are citizens of the country where the MNE's subsidiary is located.
Host-country nationals
________ are typically the largest proportion of workers hired abroad and usually work in manufacturing, assembly, basic service activities, clerical work, and other nonmanagerial functions.
Host-country nationals
Managers who exemplify an open-minded attitude and who appreciate cultural diversity are described as applying a global ________.
Mindset
________ is a fee paid periodically to compensate a licensor for the temporary use of its intellectual property, often based on a percentage of gross sales generated from the use of the licensed asset.
Royalty
Which of the following activities is applicable to the final stage of exporting?
The firm modifies advertising and public relations to suit individual markets.
Which of the following is true about foreign units of a company using a multidomestic strategy?
They are autonomous and operate independently.
A global market segment refers to ________.
a group of customers who share similar characteristics across many national markets
A firm that develops the capacity to sell its products by investing in marketing and selling operations is ________.
acquiring downstream value-chain facilities
The purpose of intellectual property rights is to ________.
allow inventors monopoly advantage for a specified period of time
In which of the following situations is the employee considered a host-country national?
an American MNE employs a Mexican citizen for its subsidiary in Mexico
Which of the following tasks should a show manufacturing company perform first if it needs to assess the global market opportunity?
analyze the firm's readiness to internationalize
Which of the following is an example of a global industry?
automobiles
Which of the following documents is the contract between the shipping company and the exporter?
bill of lading
________ refers to sourcing from the firm's own production facilities.
captive sourcing
Which of the following is a characteristic of an equity joint venture?
facilitates knowledge transfer between partners
Managing a firm's value-chain activities on a country-by-country basis to address diverse opportunities and risks is known as ________.
local responsiveness
Firms that anticipate close public scrutiny of their foreign operations often avoid potential difficulties by ________.
locating in culturally similar countries
Focal firms that internationalize through exporting will most likely perform ________ in the home market.
manufacturing
Which of the following is NOT provided by the licensor?
ongoing managerial guidance
The managerial routines, behaviors, and mechanisms that allow a firm to function as intended are known as ________.
organizational processes
The procurement of selected value-adding activities, including production of intermediate goods or finished products, from independent suppliers is known as ________
outsourcing
Richard Johnson, an American citizen, is a senior manager in a telecom company based in Texas. He is currently posted in and works from the company's subsidiary in Uganda, Africa. Richard is a ________.
parent-country national
International portfolio investment is characterized by ________.
passive ownership of foreign stocks and bonds