MAN Chp 8

Three of the following are factors which pressure companies for local responsiveness, which is NOT? Differences in employment laws Customization due to cultural differences Government pressure for firms to use local sources for procurement Availability of low labor costs

Availability of low labor costs

Which pair of industries would NOT be considered as "related and supporting" under Porter's diamond model? Japanese cameras and copiers Italian leather processing and shoes U.S. computers and software Highway systems and the supply of debt capital

Highway systems and the supply of debt capital

Skaredykat Inc. is considering initial expansion beyond its home market. The firm has decided not to enter markets that differ greatly from its home market, instead expanding within the twelve-nation region that includes its home country. Which of the following statements is true? The firm is not engaging in international trade. The firm is using a regional approach to international expansion. The firm will not be able understand the cultures, legal, and social norms of this market. Skaredykat is too afraid to implement an international strategy.

The firm is using a regional approach to international expansion.

Three of the following are incentives for a company to become multinational, which is NOT an incentive? To gain access to consumers in emerging markets To gain easier access to raw materials To avoid high domestic taxation on corporate income Opportunities to integrate operations on a global scale

To avoid high domestic taxation on corporate income

If intellectual property rights in an emerging economy are not well protected, the number of firms in the industry is rapidly growing, and the need for global integration is high, __________ is the preferred entry mode. exporting strategic alliance a joint venture or wholly owned subsidiary licensing

a joint venture or wholly owned subsidiary

If conflict in a strategic alliance or joint venture is not manageable, a(n) __________ may be a better option. licensing strategy exporting strategy acquisition new wholly owned subsidiary

acquisition

In Porter's model, if a country has both __________ and __________ production factors, it is likely to serve an industry well by spawning strong home-country competitors that can also be successful global competitors. basic; advanced advanced; generalized basic; generalized advanced; specialized

advanced; specialized

A licensing agreement: results in two firms agreeing to share the risks and the resources of a new venture. is the best way to protect proprietary technology from future competitors. allows a foreign firm to purchase the right to manufacture and sell a firm's products within a host country. can be greatly impacted by currency exchange rate fluctuations.

allows a foreign firm to purchase the right to manufacture and sell a firm's products within a host country.

Which of the following strategies involving their domestic markets, is a reason a company would move into international markets? demand a differentiation strategy for success. are limited in opportunities for growth. have developed unfriendly business attitudes toward the industry. have too much regulation.

are limited in opportunities for growth.

In order to work with various business functions in organizations, such as accounting, operations, and marketing, strategic managers need to: create integrative mechanisms, such as cross-functional teams. allow for specialization within functions. create functional silos. simply react to the environment.

create integrative mechanisms, such as cross-functional teams.

How are a companies returns affected when it initially becomes internationally diversified? remain stable. decrease. become more variable. increase.

decrease.

Internationally diversified firms: earn greater returns on their innovations through larger or more numerous markets. are more likely to produce below-average returns for investors in the long run. may need to decrease international activities when domestic profits are poor. are generally unable to achieve high levels of synergy because of differences in cultures.

earn greater returns on their innovations through larger or more numerous markets.

A global corporate-level strategy emphasizes: differentiated products. economies of scale. sensitivity to local product preferences. decentralizing control and limited monitoring.

economies of scale.

Which of the following is NOT an advantage associated with putting facilities in other countries? low-cost labor. access to critical supplies. access to customers. evasion of host country governmental regulations.

evasion of host country governmental regulations.

The transnational strategy is becoming increasingly necessary to compete in international markets for all of the following reasons EXCEPT: the growing number of competitors heightens the requirements to keep costs down. the desire for specialized products to meet consumers' needs. differences in culture and institutional environments also require firms to adapt their products and approaches to local environments. it is easy to use.

it is easy to use.

One of these answers is a fundamental reason for a country to utilize advanced and specialized factors of production, which is it ? lack of basic resources. monetary wealth. small workforce. protective tariffs.

lack of basic resources.

A global strategy: is easy to manage because of common operating decisions across borders. achieves efficient operations without sharing resources across country boundaries. increases risk because decision making is centralized at the home office. lacks responsiveness to local markets.

lacks responsiveness to local markets.

Firms able to standardize the processes used to produce, sell, distribute, and service their products across country borders enhance their ability to: learn how to continuously reduce costs while increasing the value of their products. increase investment in research and development. access a low-cost labor force in the host market. mitigate cultural differences.

learn how to continuously reduce costs while increasing the value of their products.

The positive results associated with increasing international diversification have been shown to: continue as the level of international diversification increases. level off and become negative as diversification increases past some point. become negative quickly. be centered in only one or two industries.

level off and become negative as diversification increases past some point.

Disney suffered lawsuits in France, at Disneyland Paris, because of the lack of fit between its transferred personnel policies and the French employees charged to enact them. This is an example of the: effects of regionalization. risks of a multidomestic strategy. liability of foreignness. effect of demand conditions.

liability of foreignness.

Terrorism creates an economic risk for firms, which: reduces the amount of investment foreign companies will make in a country perceived to be terror prone. is created by governmental bans on doing business with terrorist regimes. is offset by the above-average returns for firms that have learned how to operate in such an environment. is absorbed by firms that are highly geographically diversified and that operate in both secure and insecure locations.

reduces the amount of investment foreign companies will make in a country perceived to be terror prone.

Associations such as the European Union, Organization of American States, and the North American Free Trade Agreement encourage: global strategies. domestication. regional strategies. nationalization.

regional strategies.

All of the following are reasons why firms use international strategic alliances EXCEPT: sharing of risks and resources. alliances facilitate the development of new capabilities. learning new competencies particularly those related to technology. strategic alliances are easy to manage.

strategic alliances are easy to manage.

Which of the following best refers to an international strategy? action plan pursued by American companies to compete against foreign companies operating in the United States. strategy through which the firm sells its goods or services outside its domestic market. political and economic action plan developed by businesses and governments to cope with global competition. strategy American firms use to dominate international markets.

strategy through which the firm sells its goods or services outside its domestic market.

There are certain items managers should know about companies based in countries with a national competitive advantage, which of the following is not one of those items? success is not guaranteed as the firm implements its chosen international business-level strategy. the actual strategic choices made are most compelling reasons for success or failure. success is guaranteed as the firm implements its chosen international business-level strategy. the determinants of national competitive advantage provide a foundation for a firm's competitive advantages.

success is guaranteed as the firm implements its chosen international business-level strategy.

International corporate-level strategy focuses on: the scope of a firm's operations through geographic diversification. competition within each country. economies of scale. sophistication of monitoring and controlling systems.

the scope of a firm's operations through geographic diversification.

Increasingly, customers worldwide are demanding emphasis on local requirements and companies require efficiency as global competition increases. This has triggered an increase in the number of firms using the __________ strategy. multidomestic transnational universal global

transnational

Effectively implementing the __________ international corporate-level strategy often produces higher performance than does implementing either the __________ or __________ strategies. multidomestic; global; transnational global; multidomestic; transnational cost leadership; differentiation; focus transnational; multidomestic; global

transnational; multidomestic; global