MC
32) Any company doing business outside the home country should first carefully study the ________ in the target country. A) political culture B) nationalization C) political risk D) jurisdiction E) sovereignty
a
44) A global segment is referred to as "global teens" which includes: A) people with shared interest in fashions. B) affluent, well-traveled persons. C) movie stars. D) technology professionals. E) persons having power.
a
67) When the Coca-Cola Company convened focus groups in Europe and Asia to assess potential market acceptance of a contoured aluminum soft drink can, it was attempting to collect ________ data. A) primary B) secondary C) incipient D) quantitative E) MIS
a
78) African companies will find it easier to gain access to financing from the U.S. Export-Import Bank due to: A) AGOA. B) GATT. C) SADC. D) TDCA. E) SACU.
a
38) One challenge of using CRM is: A) integrating data into customer relationship. B) knowing amount paid by consumers in different countries. C) understanding which customers are most valuable. D) assessing the use of credit cards for payment. E) knowing the use of laptop computers by customers.
a
39) As a result of CFTA, the U.S. automakers participate in the Canadian auto market, thereby benefiting due to: A) greater economies of scale. B) decreased production costs. C) reduced competition. D) ease of exporting automobiles. E) creating a continental demand.
a
40) What type of international disputes would be taken before the International Court of Justice? A) disputes between two nations B) disputes between two companies C) disputes between a company and a nation D) disputes between a citizen of one country and a company from a different country E) disputes between profit and non-profit organizations
a
37) As cultural differences become less relevant and disposable incomes become high, a trend towards greater consumption of the following type of foods is predicted. A) French artistic foods B) American fast foods C) Chinese retail foods D) Indian spicy foods E) Mexican spicy foods
b
54) Which of the following is not true of secondary data about global markets? A) It was not gathered specifically for the research project at hand. B) It is often so expensive that small companies can't afford to use it. C) It can be accessed quickly. D) A great deal is available from government agencies. E) It cannot be retrieved online.
b
56) The company receiving the most U.S. patents in 2009 was: A) Samsung Electronics. B) IBM. C) Microsoft. D) Canon. E) Panasonic.
b
55) The English-speaking CARICOM members in the eastern Caribbean are concerned with defending their privileged trading position with: A) Russia. B) China. C) the United States. D) the United Kingdom. E) Australia.
c
69) The markets of Central and Eastern Europe present interesting opportunities and offer attractive locations for low-cost manufacturing due to: A) their location being close to the sea. B) the cultural similarities. C) wage rates being lower than in Spain, Portugal and Greece. D) strict laws and regulations. E) prohibitive tariffs and export restrictions.
c
72) The Gulf Cooperation Council (GCC) includes all of the following countries except: A) Kuwait. B) Saudi Arabia. C) Iraq. D) Bahrain. E) Oman.
c
32) In global markets, Starbucks is a good example of simultaneously executing all of the growth strategies except: A) Market penetration. B) Market development. C) Product development. D) Market orientation. E) Diversification.
d
59) Procter & Gamble has identified a group of consumers in Europe who are willing to pay premium prices for pet food that will improve the health of their pets. This is an example of ________ segmentation. A) demographic B) psychographic C) ethnic D) behavioral E) benefit
e
62) When a survey questionnaire in English is translated into Korean for use in South Korea and then translated back into English to check its accuracy, it is described as: A) incipient translation. B) comparative translation. C) native translation. D) parallel translation. E) back translation.
e
63) Tools that can be used for collecting primary data include: A) survey research and interviews. B) consumer panels and observation. C) focus groups and survey research. D) interviews and observation. E) all of the above
e
45) The most important preferential trading arrangements in Latin America do not include: A) SICA. B) the Andean Community. C) CARICOM. D) Mercosur. E) BRIC.
e
49) The unit of analysis can be a single country or region; however, for all market-entry decisions ________ data are not required. A) specific city B) statewide C) provincial D) district wise E) country wide
e
54) Which is not considered as a long-term value? A) persistence B) sense of shame C) thrift D) ordering relationships E) search for truth
e
55) All of the following correctly states McDonald's approach to standardization and adaptation of the marketing mix except: A) McDonald's standardizes some product elements and adapts others. B) McDonald's standardizes some place elements and adapts others. C) McDonald's standardizes some promotion elements and adapts others. D) McDonald's standardizes some price elements and adapts others. E) McDonald's standardizes all product elements.
e
13) Sometimes it is preferable to market to a particular age group rather than a mind-set; in such an instance psychographic studies can help marketers arrive at a deeper understanding of consumer behavior than is possible with traditional segmentation variables.
false
14) A trademark gives the inventor of a product the exclusive legal right to make, use, and sell an invention for a specific period of time.
false
9) A Customs Union represents the most fully developed form of preferential trade agreement among nations.
false
9) Africa represents a huge untapped market for shoes since most people walk barefoot. Thus, it will be easy to alter entrenched consumer behavior pattern if shoes are available.
false
The perceived value equation can be represented as Value = Price/Benefits.
false
6) Retailers are increasingly using a technique known as efficient consumer response (ECR) in an effort to work more closely with vendors on stock replenishment.
true
11) Mattel toys thought that Barbie would be as popular in Japan as it is in the United States. This assumption was due to the self-reference criterion (SRC).
true
21) A true transnational company would be characterized as "stateless."
true
27) Under the Alternative Fines Act, fines imposed on individuals may not be paid by their employer or principal.
true
28) Brazil is not among the emerging market countries who have signed the New York Convention.
true
30) The European Court of Justice, based in Luxembourg, is the European Union's highest legal authority.
true
30) The Middle East and North Africa are sometimes viewed as a regional entity known as "Mena."
true
30) The term globaphobia is used to describe an attitude of hostility towards trade agreements and global brands.
true
30) When research shows that Burberry and Ferragamo are perceived as the most similar by consumers while Coach and Dior are the farthest apart, researchers can interpret the results to show which brands are in direct competition.
true
5) CRM tools allow companies like American Express, Dell, Sharp, and Sony to determine which customers are most valuable and to react in a timely manner with customized products and service offerings that closely match customer needs.
true
7) The term "Safe Harbor" agreement applies to privacy issues pertaining to the companies that wish to transfer data to the United States from Europe.
true
9) Despite having comparable per capita incomes, other industrialized countries are nevertheless quite small in terms of total annual income.
true
9) From a global marketing perspective, the history of the Beatles' records is an interesting case study in both product adaptation and product extension.
true
The market development strategy involves seeking new customers by introducing existing products or services to a new market segment.
true
48) In high-context cultures, time is: A) monochronic. B) polychronic. C) linear. D) short. E) common
b
26) Long-term values include persistence (perseverance), defined as a general tenacity in the pursuit of a goal.
true
31) The cultural environment of a country is best defined by which characteristics? A) standard of living and stage of economic development B) production process and standards of measurement C) attitudes, beliefs, and values D) degree of nationalism and economic community membership E) fast food culture and slow food culture
c
21) It will be convenient to do a telephone survey in rural areas in China since, according to the Ministry of Information Industry reports, 40% of households have at least one fixed-line telephone.
false
26) Most global markets do not exist in nature.
true
76) In recent years, the economy of selected countries in ECOWAS has improved except in: A) Ivory Coast. B) Ghana. C) Benin. D) Sierra Leone. E) Nigeria.
d
14) The five original members of the Central American Common Market (CACM) are El Salvador, Honduras, Guatemala, Panama, and Cost Rica.
false - nicaragua not panama
7) Walmart's recent exit from the German market was due, in part, to the fact that German shoppers could find lower prices at stores known as "hard discounters."
true
8) Ideally, GDP and other measures of national income converted to U.S. dollars, should be calculated on the basis of purchasing power parities or through direct comparisons of actual prices for a given product.
true
8) In October 2011, the United States Congress finally ratified the long-delayed free trade areas with South Korea, Panama, and Colombia.
true
8) Market research is the project-specific, systematic gathering of data and is the activity that links the consumer, customer, and public to the marketer through information.
true
9) Cadbury has trademarked the color purple for its chocolate confectionary packaging.
true
78) Anheuser-Busch, the brewer of Budweiser beer, lost its independence after years of focusing primarily on the domestic U.S. market. This is most likely a result of: A) management myopia. B) national controls. C) opposition to globalization. D) newcomers from emerging markets. E) organizational culture
a
79) A company stands a better chance of having an international arbitration award upheld if its home-country government has signed: A) the Paris Convention. B) the Prague Convention. C) the New York Convention. D) the Vienna Convention. E) the Geneva Convention.
c
32) The Gross Domestic Product (GDP), a measure of a nation's economic activity, is calculated by all of the following factors except: A) consumer spending. B) investment spending. C) government purchases D) industry purchases. E) net exports.
d
33) An ________ system allows a company's business units to submit orders, issue invoices, and conduct business electronically with other company units as well as outside companies. A) Internet B) intranet C) ECR D) EDI E) EPOS
d
33) Slumdog Millionaire, a movie which received several awards and an Oscar in 2009, was filmed on a location in and around: A) London. B) San Francisco. C) Cancun. D) Mumbai. E) Moscow.
d
58) For consumer products, qualitative research is especially well suited to accomplish all of the following tasks except: A) provide consumer understanding. B) describe the social and cultural context of consumer behavior. C) identify core brand equity and brands. D) assess consumer spending trends. E) what consumers really feel.
d
31) Despite the positive publicity, the phrases used to describe the arbitrary exercise of state power in Russia include all of the following except: A) state capitalism. B) political culture. C) renationalization. D) kleptocracy. E) managed democracy.
b
13) If a market researcher would like to know how much the typical Nigerian consumer spends on soft drinks, the information can be obtained from GNP or GDP.
false
18) Competing ideologies in South America help explain why intraregional trade is yielding more benefits.
false
20) "McDonaldization of culture," a term coined by Geert Hofstede, refers to the wide spread of McDonald's restaurants in the world and its adverse impact on global culture.
false
20) Chile decided to become only an associate member of Mercosur and hence participates in the free trade area aspect of Mercosur as well as the customs union.
false
5) A "value" is an organized pattern of knowledge that an individual holds to be true about the world.
false
5) If Nestlé decides not to market biscuits (cookies) in the United States due to competitive reasons, it is considered as a lack of strategic focus and missed opportunity.
false
5) The lack of employment as seen in the recent times is indicative of the fact that manufacturing is in decline.
false
6) For some consumer products such as cigarettes, soft drinks, and candy that have a low per-unit cost, income is often a more valuable segmentation variable than population.
false
7) A free trade area represents the most fully developed form of preferential trade agreement among nations.
false
7) Aesthetic elements that are attractive, appealing, and in good taste are perceived as decent and accepted universally.
false
50) All of the following facts pertain to Brazil except: A) Brazil is the largest country in Latin America. B) Brazil boasts the richest reserves of natural resources in the hemisphere. C) Brazil's top trading partner is China. D) Brazil's GNI has grown at an average annual rate of 4 percent over the past 8 years. E) Brazil lacks logistics software, horse-drawn carts are still a common sight on many roads.
e
51) According to Geert Hofstede, which of the following is a key cultural dimension that helps account for rapid economic growth in Asia? A) power distance B) individualist/collectivist C) feminine/masculine D) uncertainty avoidance E) long-term orientation
e
52) Sony's U.S. Consumer segments included all of the following except: A) Affluent. B) Zoomers. C) SoHo. D) Gen Y. E) Fashionists.
e
53) Marketers must be aware of the impact of SRC and other cultural assumptions since: A) it can have several positive effects on market planning. B) it enhances management's willingness to pursue market research. C) it can help ensure that the research effort is designed with minimal home-country bias. D) it can help ensure that the research effort is designed with minimal second-country bias. E) All of the above are correct.
e
57) Uniqlo, a division of Japan's Fast Retail, operates about 850 stores in Japan and currently has six stores in the United States. Their plans call for a total of 200 U.S. stores by 2020. The fulfillment of their plan will depend on: A) industry conditions. B) sources of competitive advantage. C) the condition of the apparel market worldwide. D) the demand in Japan for U.S. style garments. E) all of the above
e
57) Which of the following is not recommended by expert David Arnold for companies engaged in global market research? A) use multiple indicators B) develop customized measures specific to an industry or product C) conduct comparative assessments in neighboring countries D) observation should be weighted more heavily than statements of purchase intention E) assess a particular market in isolation
e
58) Nike produces only a small portion of its output in China, but when the firm refers to China as a "two-billion-foot market," it is referring to the fact that: A) the Chinese do not wear shoes. B) the Chinese shoe market is very competitive. C) China can develop its own shoe market. D) it will take a long time for China to develop future market. E) China is a potential future market.
e
72) A number of multilateral trade agreements have accelerated the pace of global integration which include: A) NAFTA. B) GATT. C) WTO. D) EU. E) all of the above
e
10) Sweden's smaller population explains why IKEA, Saab, and Ericsson have looked beyond their borders for significant growth opportunities.
true
22) One way to assess a company's "degree of transnationality" is to compute the ratio between the sales outside the home country to total sales.
true
22) The thirty nations that belong to the OECD, who believe in market-allocation economic systems and pluralistic democracy, addressed the vexing problem of bribery by requiring members to cooperate when pursuing bribery allegations.
true
29) The six countries in the Gulf Cooperation Council (GCC) hold about 45% of the world's known oil reserves, but production is only about 18% of world oil output.
true
5) Global marketers must determine whether a standardized or an adapted marketing mix is required to best serve the wants and needs of the consumers.
true
6) In Indonesia, home of the world's largest Muslim population, KFC uses Ramadan-themed outdoor advertising to encourage Indonesians to come to the restaurants at buka puasa, the end of each day's fast.
true
6) The Yugo automobile achieved a modest level of U.S. sales in the 1980s despite a "don't buy" rating from a consumer magazine.
true
6) Today, market capitalism is widely practiced around the world, most notably in North America and the European Union.
true
1) "Frugal Engineering" and "Reverse Innovation" are some of the terms that GE, Proctor & Gamble, Siemens, and Unilever are using to describe efforts to penetrate more deeply into emerging markets
true
1) Affluent Russians can now shop at Versace, Burberry, Bulgari, and other exclusive brands.
true
1) Although many professional women appreciated the conservative styling of the signature Coach bag, they did not necessarily regard Coach's accessories as must-have fashion items.
true
1) The United States and the EU have the world's largest trading relationship.
true
10) As per the listings of the 2013 Index of Economic Freedom by the Heritage Foundation, there is a high correlation between the degree of economic freedom and the extent to which a nation's mixed economy is market-oriented.
true
10) Market research should focus on finding out how a potential customer can be changed into an actual customer.
true
10) Music represents a "transculture" that cannot be identified with any particular nation since rhythm is a universal aspect of music.
true
11) In a Common Market there are no internal barriers to trade, and it allows for free movement of factors of production such as labor and capital.
true
12) In China, authorities have the power to dictate which songs can be marketed and performed.
true
12) Starbucks opened an experimental store in Amsterdam that serves as a testing ground for new design concepts such as locally sourced and recycled building materials.
true
12) The death of Venezuelan President Hugo Chavez in March 2013 marked the end of an era, where he toyed with the idea of pursuing a "third way" to economic growth.
true
12) Under Economic Union, a doctor or lawyer qualified in one country can practice in another member country.
true
13) Domino's Pizza had to pull out of Italy because Italians perceived its products to be "too American."
true
13) In spite of NAFTA creating a free trade area, Mexican avocado growers can ship their fruit to the United States only during the winter months, and only to states in the northeast subject to a quota of $30 million worth of avocados per year.
true
13) The requirement that all restaurants declare that the meat is "halal" is based on Islamic Laws.
true
14) About 75 percent of the Coca-Cola Company's operating income and two-thirds of its operating revenue are generated outside North America.
true
14) Although some food preferences remain deeply embedded in culture, plenty of evidence suggests that global dietary preferences are converging.
true
14) If Avon would like to sell cosmetics in India, a good estimate can be achieved by researching the average wage of an office secretary.
true
15) A latent market is, in essence, an undiscovered market segment.
true
16) Despite trade agreements, attempts to achieve integration in Central America have been described as uncoordinated, inefficient, and costly. There are still tariffs on imports of sugar, coffee, and alcoholic beverages.
true
16) Myanmar, a low-income country in Southeast Asia with a population of 65 million people, can be considered as one of the emerging markets.
true
17) A key issue is global patent protection for software. Although copyright law protects the computer code, it does not apply to the idea embodied in the software.
true
17) According to the Asian Development Bank, only about one-quarter of Myanmar's population has access to reliable electricity, and power shortages and outages are not unusual.
true
19) A recent rash of antitrust actions brought in the United States against foreign companies has raised concerns that the United States is violating international law as well as the sovereignty of other nations.
true
23) According to U.S. laws, there is no restrictions on remittances of royalties received abroad based on the commercial negotiation between licensor and licensee.
true
23) Economic growth has reduced resistance that might otherwise have developed in response to the entry of foreign firms into domestic economies.
true
23) If a potential Latin American customer insists on giving you a tour of the architectural highlights of his city prior to discussing business, it's a clue that you are doing business in a high-context culture.
true
23) One of the first-mover disadvantages is that a late-mover competitor may reap benefit from the investments made in marketing and establishing in a country.
true
25) A marketer of breakfast cereals might send researchers to preselected households at 6 a.m. to watch families go about their morning routines.
true
25) Bhutan has relied on a measure besides economic growth referred to as the Gross National Happiness (GNH).
true
26) Differentiated global marketing represents a more ambitious approach than concentrated target marketing.
true
26) The Vatican City uses the euro although it is not a part of the European Union.
true
26) The important fact to recognize about the overall balance of payments is that it is always in balance, although imbalances do occur in subsets of the overall balance.
true
27) Coca-Cola had to delay launching its Powerade sports drink in Europe due to the lack of uniform food safety laws in the European Union.
true
28) Movements such as "the Arab Spring" have forced some of the regional leaders to make economic and political concessions.
true
28) When a company conducts business across boundaries in countries with different currencies, it is thrust into the turbulent world of exchange risk.
true
29) Anheuser-Busch, the brewer of Budweiser beer, lost its independence after years of focusing primarily on the U.S. market.
true
29) Benetton uses the slogan "United Colors of Benetton" to position itself as a brand concerned with the unity of humankind. This type of strategy is referred to as GCCP (global consumer culture positioning).
true
29) Former Disney chairman Michael Eisner and other company executives were blinded by ethnocentrism. Avoiding the Self-Reference Criterion (SRC) requires a person to suspend assumptions based on prior experience and success and be prepared to acquire new knowledge about human behavior and motivation.
true
3) Kleptocracy refers to rampant corruption and bribery.
true
30) Hedging exchange rate exposure involves establishing an offsetting currency position such that the loss or gain of one currency position is offset by a corresponding gain or loss in some other currency.
true
30) In the cosmetics industry, Unilever pursues differentiated global marketing strategies by targeting both ends of the perfume market.
true
4) The BRICS nations and other emerging markets are also home to companies that are challenging established global giants at home and abroad.
true
4) To prevent the most value-conscious shoppers from defecting to Walmart, Tesco mined its database to identify Clubcard users who buy the lowest-priced grocery items.
true
4) When marketers refer to "fast-food culture", or "credit-card culture" they are referring to a cosmopolitan culture which is comprised of various segments of the population which are interconnected.
true
9) According to the 2013 Index of Economic Freedom compiled by the Heritage Foundation, Hong Kong is ranked as having the highest degree of economic freedom.
true
9) If a foreign company is taken over by the host country government, and some form of compensation is paid, "expropriation" has occurred.
true
Starbucks is building on its loyalty card and rewards program in the United States with a smartphone app that enables customers to pay for purchases electronically. This is an example of Market Penetration.
true
83) Giving examples show how technology is providing interesting new opportunities for exploiting linguistics in the name of marketing.
Answer: With the increased use of information technology and computers, there has been a noticeable positive and negative impact on linguistics. Text messaging and chat rooms have made it much easier to abbreviate common words, primarily due to limited space on keyboards of cell phones such as BlackBerry and to reduce time involved. Thus, a combination of numerical and alphabetical abbreviations is being used. For example, GR8 (great); CU (see you); AFK (away from keyboard); b4 (before); BBL (be back later); BRB (be right back); GMTA (great minds think alike); l8r (later) and ^5 (high five). In Korean, the phonetic pronunciation of the numerical sequence 8282 (Pal Yi PalYi) means hurry up and 7179 (Chil Han Chil Gu) sounds like "close friend." In some languages numerology has different meanings which when decoded can convey messages. In addition to being exciting, such use of terminology can make slogans stick in the minds of consumers and therefore can be used effectively in marketing. Some of these are getting universally accepted terms due to common use of computers and technological gadgets.
50) The U.S. government's most comprehensive source of world trade data is: A) National Trade Data Base (NTDB). B) Census Bureau. C) Bureau of Economic Analysis. D) Eurostat. E) Gross Domestic Product (GDP).
a
51) According to the Global Market Research Reports, data for Chinese markets are available for: A) cosmetics. B) online music. C) whiskies. D) luxury goods. E) pharmaceutical.
a
53) Long-term values include all of the following except: A) dynamism. B) persistence. C) sense of shame. D) thrift. E) ordering relationships.
a
50) Lawyers are more important in: A) low-context cultures. B) high-context cultures. C) Indian cultures. D) Korean cultures. E) Japanese cultures.
a
73) A key word(s) in conducting business in the Middle East is: A) Arab Spring. B) Connection. C) Discrimination. D) Male dominance. E) haggling.
b
79) The world's best-known cosmetics companies are setting their sights on a lucrative new market segment: the emerging middle classes in countries such as Brazil, Russia, India, and China. However, these companies have to understand: A) that women's preferences in those countries are almost similar. B) that Chinese consumers are not willing to invest in beauty products. C) what beauty means to Chinese women. D) that working Indian women prefer only local brands. E) cosmetics are preferred mostly by the top end of the market in China.
c
80) The reason why Greece, Ireland, Portugal, and Spain sometimes are referred to as the eurozone's "peripheral countries" is: A) that all have tourist attractions. B) that they are situated in the peripheral parts of Europe. C) that they all rank lower than their EU neighbors in terms of infrastructure. D) that they are riding on the way of technology boom. E) that they are all marred by sex scandals.
c
80) When countries or regions experience currency and/or economic stress, all of the following events can take place except: A) increased exposure to certain risks. B) new profit opportunities. C) lower local currency financing costs. D) bad debts occur. E) cancellation of aircraft equipment sales.
c
80) A massive effort dubbed as "Moses Project" is underway in Venice in order to: A) promote passive tourism. B) reduce the number of billboards on historic sites. C) provide biblical information to tourists. D) prevent flooding. E) modernize accommodations.
d
65) A person who assumes that his or her home country is superior to the rest of the world is said to have: A) ethnocentric orientation. B) polycentric orientation. C) regiocentric orientation. D) geocentric orientation. E) None of the above
a
40) A global segment is referred to as "global elite" which includes: A) people between the ages of 12 and 19. B) affluent, well-traveled persons. C) graying population. D) technology professionals. E) persons having power.
b
19) One of the advantages of targeting a market segment globally is that although the segment in a single-country market might be small, even a narrow segment can be served profitably if the segment exists in several countries.
true
19) Westerners doing business in the Middle East must be careful not to reveal the soles of their shoes to hosts or pass documents with the left hand.
true
2) Flush with dollars from oil exports, the Russian government lifted all currency controls and made the ruble freely convertible in world markets.
true
2) GATT (General Agreement on Tariffs and Trade) itself had no enforcement power, and the losing party in a dispute was entitled to ignore the ruling.
true
2) Global market segmentation is based on the premise that companies should attempt to identify consumers in different countries who share similar needs and desires.
true
2) The Cold War decades that followed World War II saw the East and the West jockeying for geopolitical advantage.
true
2) Venice is threatened by modern invaders since it is one of the top cruise destinations.
true
20) A company with a geocentric orientation views the world as a potential market and strives to develop integrated global strategies.
true
20) In Brazil, Daimler AG works with a cooperative of farmers who transform coconut husks into natural rubber to be used in auto seats, headrests, and sun visors.
true
20) Nippon Paper Industries was found guilty in a U.S. court of conspiring with other Japanese companies to raise fax paper prices in the United States.
true
20) Volkswagen, Peugeot, Chrysler, and other global automakers have established manufacturing operations in China since they consider it to be an incipient market.
true
21) CARICOM's main objective has been to achieve a deepening of economic integration by means of a Caribbean common market.
true
21) In Saudi Arabia, the Communication and Information Technology Commission (CITC) was ready to restrict BlackBerry services citing security concerns since the location of RIM (Research in Motion) servers were in Canada.
true
21) Product and market opportunities in postindustrial society are heavily dependent upon new products and innovations.
true
21) Virgin chief executive Richard Branson learned that starting a soft-drinks war with Coca-Cola was crazy, although it was also one of the things that raised the profile of the Virgin name in America.
true
22) Formation of a cartel like OPEC, consisting of oil-producing companies, would most likely be illegal in the United States.
true
22) Individually and collectively, Association of Southeast Asian Nations (ASEAN) countries are active in regional and global trade.
true
23) Since 2010 there is a formal establishment of a new China/ASEAN Free Trade Agreement.
true
23) The CEO of Otis Elevators says they measure elevator populations in countries as units installed per thousand people. According to this, China is about half an elevator per thousand people.
true
24) A company hoping to protect its trade secrets from being stolen by a foreign company can seek relief under the TRIPs agreement if both companies do business in GATT signatory countries.
true
24) BMW's slogan "the ultimate driving machine," is an example of an attribute or benefit which has proven successful in their positioning strategy.
true
24) Competitive bidding is most likely to be infrequent in a low-context culture.
true
24) It is difficult to obtain a representative sample in Brazil since the technological infrastructure for gathering market data is minimal.
true
24) Singapore alone accounts for more than one-third of U.S. trading activities with ASEAN countries.
true
25) Evidence of the company's ongoing commitment to innovation can be seen in continuous new product introduction.
true
27) In global marketing research, it is important to establish scalar equivalence when obtaining information from different countries.
true
27) Lexus developed new diesel models as well as a gas-hybrid engine because Germans want the option of buying vehicles with diesel engines.
true
28) A sense of shame leads to sensitivity in social contacts within high-performing Asian countries such as Hong Kong, Taiwan, and Japan.
true
29) The United Nations Conference on International Trade Law (UNCITRAL) has also been a significant force in the area of arbitration.
true
3) EDI links with vendors to enable retailers to improve inventory management and restock hot-selling products in a timely, cost-effective manner.
true
3) People or organizations with needs and wants and the willingness and ability to buy or sell represent the definition of a market.
true
3) Sushi, Falafel, Tandoori Chicken or Pizza is in demand in many parts of the world. This phenomenon can be due to the pluralization of consumption and segment simultaneity.
true
3) The WTO's neutral trade experts also serve as mediators in global trade disputes.
true
30) According to Roger's diffusion theory, most customers will not purchase expensive products without the "hands-on" experience marketers call "trial."
true
5) A preferential trade agreement is a mechanism that confirms special treatment on select trading partners, thereby at times discriminating against other trading partners.
true
5) British Petroleum, British Airways, and Rolls-Royce were some of the companies that were privatized under so-called Thatcherite economics.
true
7) About two-thirds of world GNI is generated in the Triad countries, whereas only about 12% of the world's population is located in those countries.
true
8) Nike dropped their well-known tag line "Just do it" in advertising women's clothing in Europe and replaced it by the slogan "Here I am" since college-age women in Europe are not as competitive about sports as men are.
true
86) Discuss the guidelines submitted by David Arnold pertaining to the importance of data gathering for market research. Indicate the rationale behind each guideline.
(a) Multiple indicators should be used rather than a single measure. This approach will decrease the level of uncertainty for decision makers. (b) Individual companies should develop customized indicators specific to the industry, product market, or business model. Such indicators should leverage a company's previous experience in global markets. (c) Comparative assessments should always be conducted in multiple markets. Comparative assessment enables management to develop a "portfolio" approach in which alternative priorities and scenarios can be developed. (d) Observations of purchasing patterns and other behavior should be weighed more heavily than reports or opinions regarding purchase intention or price sensitivity. Sometimes it is difficult to accurately survey consumer perceptions.
86) Authors Prahalad and Hammond have identified several assumptions and misconceptions about the "bottom of the pyramid" (BOP). Explain these assumptions, giving examples.
Answer: (1) The poor have no money. In Bangladesh villagers spend considerable sums to use village phones operated by local entrepreneurs; (2) the poor are too concerned with fulfilling basic needs to "waste" money on nonessential goods. Consumers who are too poor to purchase a house do buy luxury goods such as televisions and cell phones; (3) the goods sold in developing markets are so inexpensive that there is no room for a new market entrant to make a profit. Since the poor often pay higher prices for many goods, there is an opportunity for efficient competitors to realize attractive margins by offering quality and low prices; (4) people in BOP markets cannot use advanced technology. Residents of rural areas can and do quickly learn to use cell phones and PCs; and (5) global companies that target BOP markets will be criticized for exploiting the poor. A global company offering basic goods and services that improve a country's standard of living can earn a reasonable return while benefiting society.
81) The world economic environment is changing very rapidly and has become increasingly competitive. In order to achieve success, based on author William Greider's analysis, what are the realities that executives and marketers should take into account in such a dynamic environment?
Answer: (a) Capital movements have replaced trade as the driving force of the world economy; (b) production has become "uncoupled" from employment; (c) the world economy dominates the scene; individual country economies play a subordinate role; (d) the struggle between capitalism and socialism is largely over; and (e) the growth of e-commerce diminishes the importance of national barriers and forces companies to reevaluate their business models.
82) Traditionally economists identified four main types of economic systems. However, due to globalization it is harder to categorize the systems narrowly. What will be more robust descriptive criteria that can be used for classification?
Answer: (a) type of economy; (b) type of government; (c) trade and capital flows; (d) the commanding heights; (e) services provided by the state and funded through taxes; (f) institutions; and (g) markets.
89) One of the basic elements of Roger's diffusion theory is the concept of adoption process which deals with the mental stages through which an individual passes from the time of his or her first knowledge of an innovation to the time of product adoption or purchase. Briefly describe these stages given examples of Apples iPhone.
Answer: 1. Awareness. In the first stage the customer becomes aware for the first time of the product or innovation. Mass media advertising was critical in informing customers about the new iPhone. 2. Interest. Enough interest was generated by advertisement which did not fully disclose the exciting features of iPhone but did provide some clues. 3. Evaluation. Customers became curious and started mental assessment of the product's benefits in relation to present and anticipated future needs. Also, comparative assessment was made to see how it is more versatile than the existing technology. 4. Trial. Most customers did not purchase iPhone since it was expensive and waited to get some "hands-on" experience. Such trials are common for many products and services. 5. Adoption. This is the final stage where the individual will make a decision to buy; purchases it; or adopts it. Personal sources of information are more important in the entire process than impersonal sources. Word-of-mouth becomes a very important persuasive force affecting the decision to buy.
86) Discuss the basics of a framework for selecting target markets highlighting the salient features of David Arnold's framework.
Answer: A framework for selecting target markets should take into account the market size of the targeted market. The market size should then be multiplied by the competitive advantage in that country. Multiplying the market size and competitive advantage index yields a market potential. The next step in the analysis requires an assessment of the various market access considerations. Finally, multiplying the market potential by the terms of access index gives the final market potential. This framework takes into account the competitive advantage, market potential and the terms of access. This framework should prove useful as a preliminary screening tool for inter-country comparisons. However, it does not go far enough in terms of assessing actual market potential. Global marketing expert David Arnold has developed a framework that goes beyond demographic data and considers other marketing-oriented assessments of market size and growth potential. Thus, instead of a "top-down" segmentation analysis beginning with, for example, income or population data from a particular country, Arnold's framework is based on a "bottom-up" analysis that begins at the product-market level. The product-market refers to a market defined by a product category. For example, in the automotive industry that would refer to luxury car market. Arnold's framework incorporates two core concepts: marketing model drivers and enabling conditions. Marketing model drivers are key elements or factors required for a business to take root and grow in a particular country market environment. The drivers may differ depending on whether a company serves consumer or industrial markets. Enabling conditions are structural market characteristics whose presence or absence can determine where the marketing model can succeed. For example, in India, refrigeration is not widely available in shops and market food stalls. This creates challenges for storing dairy products and confections. So the enabling conditions are very important. After marketing-model drivers and enabling conditions have been identified, the management should weigh the estimated costs associated with entering and serving the market with potential short- and long-term revenue streams. One way to determine the marketing model drivers and enabling conditions is to create a product-market profile.
85) What are the secondary sources of data and how do these sources differ from primary sources? Give examples of sources from which secondary data can be obtained.
Answer: A low-cost approach to market research and data collection begins with desk research. There are a lot of secondary sources which are a good place to start. Data from census bureaus; government and private agencies; trade associations; chamber of commerce; published reports; academic institutions; and public libraries are not only extensive but can provide valuable information in a very cost-effective manner. All of these are considered as secondary sources since the data already exist and is not based on the research conducted by the company. Data obtained by conducting research by the company is considered as a primary source. This may also include the company's unpublished reports and other financial data. Other secondary sources include the U.S. Government's National Trade Data Base (NTDB), an online resource from the Department of Commerce. Similarly, there are other data which are published by almost all of the federal government agencies. Most countries compile data related to the gross national product (GNP), gross domestic product (GDP), consumption, investment, government expenditures, price levels, and import/export expenditures. Demographic data are available from the United Nations' agencies as well as other international agencies. The Statistical Yearbook of the United Nations contains global data on agriculture, mining, manufacturing, construction, energy production consumption, internal and external trade, health, housing, education and lots of other services. Similar data are collected by the U.S. Central intelligence Agency which publishes the World Fact book. Other sources are the World Bank and the International Monetary Fund. The Economist and Financial Times regularly compile comprehensive surveys of regional and country markets and include them in their publications. Data from many of these sources are generally available in both print and electronic forms. There are also different country Web sites which also provide some useful information. Syndicated studies published by private research companies are another source of secondary data and information.
88) How do ethnocentric orientations of a company differ from polycentric orientations? Give examples of how companies react under both orientations.
Answer: A manager who assumes that his or her home country is superior to the rest of the world is said to have an ethnocentric orientation. Polycentric orientation is the opposite of ethnocentric orientation, where a manager assumes that each country in which a company does business is unique. In ethnocentric orientation, foreign operations or markets are typically viewed as being secondary or subordinate to domestic ones. For example Nissan's ethnocentric orientation caused the managers to believe that consumers all over the world should be able to behave as Japanese. In Northern Japan, people would put blankets over the hoods of their cars during cold winters and managers assumed that people in the United States should be able to do the same. Citicorp's financial company executives have polycentric orientation, where the assumption was that each country is different, and there is a need for a localized or adaptation approach.
83) What are the differences between a patent, trademark, and a copyright? What is meant by counterfeiting?
Answer: A patent is a formal legal document that gives an inventor the exclusive right to make, use, and sell an invention for a specified period of time. Typically, this invention should be a new, novel and/or non obvious creation. On the other hand, a trademark is defined as a distinctive mark, motto, device, or emblem that a manufacturer affixes to a particular product or package to distinguish it from goods produced by other manufacturers. A copyright establishes ownership of a written, recorded, performed, or filmed creative work. Counterfeiting is the unauthorized copying and production of a product. An associative counterfeit, or imitation, uses a product name that differs slightly from a well-known brand but is close enough that consumers will associate it with the genuine product. The worst form of counterfeiting is known as piracy, which is the unauthorized publication or reproduction of copyrighted work. Counterfeiting and piracy are particularly important in industries such as motion pictures, recorded music, computer software, and textbook publishing. The United States in particular has a vested interest in intellectual property protection worldwide since it is home to many companies which have patents, trademarks, and copyrighted materials.
83) What are some of the pitfalls in assessing market potential and choosing target markets or segments?
Answer: After segmenting the market, the next important step is to assess the attractiveness of the identified segments. This is an important part when assessing emerging country markets as potential targets. Several potential pitfalls in assessment should be taken into account. In general, there is a tendency to overstate the size and short-term attractiveness of individual country markets. This can happen if estimates are based primarily on demographic data such as income and population. For example, the population figures in India and China can create a bloated image. Short-term profitability may be hard due to prevailing conditions in these emerging markets. Persistence and long-term outlook often pays off in new markets. A second pitfall may originate from pressures placed on marketers by shareholders or competitors. The possibility of missing out on entering a condition is in itself a stress-causing factor. Marketers may find themselves overwhelmed at times by such pressures and the urge to react quickly. Another factor may be the decisions made based on convenience or opinion of persons/advisors not residing in the home country. The right representatives or distributors should be selected in order to be successful.
86) Hofstede considers culture as "the collective programming of the mind," which makes it necessary to look at the attitudes, beliefs, and values. Giving an example of a country, explain how these attributes are so important.
Answer: An attitude is a learned tendency to respond in a consistent way to a given object or entity. Actually, they are clusters of interrelated beliefs. Many Japanese believe that the West is the source of important fashion trends, and therefore they share a favorable attitude toward American brands. A belief is an organized pattern of knowledge that an individual holds to be true about the world. Japan's monocultural society reflects the belief among the Japanese that they are unique in the world. Attitudes and beliefs are closely related to values. A value can be defined as an enduring belief or feeling that a specific mode of conduct is personally or socially preferable to another mode of conduct. Values represent the deepest level of a culture and are present in the majority of the members of a particular culture. The Japanese, for example, strive to achieve cooperation, consensus, self-denial, and harmony. Since these all represent feelings about modes of conduct, they are values. Attitudes, beliefs, and values are all interrelated and extremely important from a marketing point of view.
85) Nippon Paper Industries was found guilty in a U.S. court of conspiring with other Japanese companies to raise fax paper prices in the United States under the antitrust laws. What are the implications of such a law, and how does it affect international business?
Answer: Antitrust laws in the United States and other countries are designed to combat restrictive business practices and to encourage competition. Agencies such as the U.S. Federal Trade Commission, Japan's Fair Trade Commission, and the European Commission enforce antitrust laws. According to some legal experts, the pressures of global competition have resulted in an increased incidence of price-fixing and collusion among companies. The Sherman Act of 1890 prohibits certain restrictive business practices, including fixing prices, limiting production, allocating markets, or any other scheme designed to limit or avoid competition. The law applies to the activities of U.S. companies outside U.S. boundaries, as well as to foreign companies conducting business in the United States. Nippon Paper Industries was found guilty in a U.S. court of conspiring with other Japanese companies to raise fax paper prices in the United States. The Japanese government denounced the U.S. indictment as a violation of international law and Japan's sovereignty. A U.S. federal judge struck down the indictment, ruling that the Sherman Act does not apply to foreign conduct. However, a federal appeals court reversed the decision.
85) The Coca-Cola Company has convincingly demonstrated that the ability to think globally and act locally can be a source of competitive advantage. Justify this statement using examples.
Answer: Coke achieved success in Japan by spending a great deal of time and money to become an insider. The company built a complete local infrastructure with its sales force and vending machine operations. Coke's success in Japan is a function of its ability to achieve "global localization," being as much of an insider as a local company but still reaping the benefits of world-wide operations. The company is adept at adapting sales promotion, distribution, and customer service efforts to local needs. Coke has become one of the brands that have spent time and money getting this experience in unknown territories.
86) According to experts, mastering the Japanese market is considered to be a very difficult task. However, with the lucrative market in Japan, it is imperative to understand the intricacies in order to be successful in business. What are some of the factors that need to be considered by corporations that would like to conduct business in Japan?
Answer: Conducting business in the Japanese market demands understanding, flexibility, ambitions, and long-term commitment. Although the Japanese market has changed from a closed market to just being a tough market, there are still several barriers that need to be overcome. These barriers include differences in business attitude as well as laws. Companies interested in doing business with Japan should be willing and able to provide top-quality products and services. Also, the products and services should be tailored to local tastes. All this requires countless visits and socializing to build trust as well as mutual understanding. Marketers must also master the "keiretsu" system of tightly knit corporate alliances.
83) If Coach, a luxury good marketer, would like to study the consumer perceptions of global luxury brands, what would be the best approach since there are several competitors?
Answer: Consumers may differentiate one designer brand from another in various ways, such as how easy it is to purchase each brand, how visible each brand is, whether or not the brand offers diffusion lines, etc. A study can be conducted to study the perceptual dimension of "ubiquitous verses rare." A five-point similarity judgment scale of selected designer brands can be developed. The responses achieved help marketers understand which brands in a particular category are in direct completion with each other and which are not. The responses can be analyzed using an MDS program; the perceptual mapping. The perceptual map will show the differences such as between ubiquity and rarity; or exclusivity and accessibility. The position of Coach, thus can be studied from the map. This type of study could help Coach to respond to new industry realities, which include a shift in the perception of what constitutes luxury and the increasing fragmentation of consumer tastes. Such a map will be helpful in knowing up-and-coming fashion designer hoping to launch a new line.
82) Due to globalization "it is a small world after all." Also, vast scale migration of populations due to various reasons, including opportunities, has created large segments of ethnic population. Considering these facts, highlight the ethnic segmentation and its importance.
Answer: Due to several reasons, in many countries the population consists of ethnic groups. For example, in the United States there are three major ethnic segments—African/Black Americans; Asian Americans; and Hispanic Americans. In other countries there are different combinations of ethnic population. Each segment shows great diversity and can be further subdivided. Even those coming from one country may have differences in language, culture, religion, and other attitudinal aspects. Their purchasing behavior is different within groups and sub-groups. From a marketing standpoint these groups offer great opportunity. Companies in a variety of industry sectors, primarily food and beverages, household goods, and financing services can benefit by targeting these groups. For example, Japanese automakers have been successful in targeting ethnic populations in different parts of the world.
89) What is "Economic exposure," and how does it impact companies like Nestlé, Daimler AG, Royal Dutch Shell, and Astra Zeneca? Assess the impact of a weaker dollar on the financial performance of these corporations.
Answer: Economic exposure refers to the impact of currency fluctuations on the present value of a company's expected future cash flows. Economic exposure is directly proportional to the amount of business a company conducts outside its home market. Nestlé, for example, has 98% of annual sales taking place outside of Switzerland and therefore faces critical economic or currency exposure. Similarly, Daimler AG, Royal Dutch Shell and Astra Zeneca generate over one-third of their sales from the United States. They are all in the eurozone. If the dollar becomes weak relative to the euro, all of these companies will face economic exposure. On the other hand, U.S. companies will be less exposed compared to these companies.
89) Global marketing does not necessarily mean operating everywhere since there are forces affecting global integration and global marketing. Justify this statement using examples based on the world economic trends.
Answer: Economic growth in key developing countries creates market opportunities that provide a major incentive for companies to expand globally. Due to the rising per capita incomes in India, China, and elsewhere, the growing ranks of middle-class consumers have more money to spend than in the past. At the same time, slow growth in industrialized countries has compelled management to look ahead for opportunities in nations or regions with high rates of growth. Also, the economic growth has reduced resistance that might otherwise have developed in response to the entry of foreign firms into domestic economies. The worldwide movement toward free markets, deregulation, and privatization is also a driving force. The trend toward privatization is opening up formerly closed markets creating tremendous opportunities.
90) In most of the European Union countries, the influence of regulatory agencies is pervasive. What steps will be necessary of a corporation to protect business interest and advance new programs?
Answer: Executives of companies who would like to go global should realize that the influence of regulatory agencies worldwide is getting very pervasive. One way to understand the operation and legal aspects related to business environment is to have permanent representation of the company in the country. International companies such as McDonald's, Nike, and Toyota have several people representing their interests to the European Commission. Companies hire several lobbyists to represent their interests as well as to influence the direction of the regulatory process. U.S. law firms and consulting firms also have sharply increased in number and can be seen having offices in Brussels. This way they can gain insight into EU politics and have access to its policy makers. It may also be possible to hire local people as official representatives of the companies. It is estimated that currently there are 15,000 lobbyists in Brussels representing about 1,400 companies and nonprofit organizations from around the world.
81) Why do some critics refer to GATT as the "General Agreement to Talk and Talk" and how does its successor, WTO, provide a better forum for trade agreements?
Answer: GATT was an organization that was handling 300 trade disputes during its half century of existence. It itself had no enforcement power, and the process of dealing with disputes stretched for years. The losing party had the right to ignore the ruling. Therefore, it was referred to as more of a talking rather than enforcing body. WTO provides a forum for trade-related negotiations among its 150 members. The WTO has a Dispute Settlement Body (DSB) that mediates complaints concerning unfair trade barriers and other issues between the WTO's member countries. During a sixty-day consultation period, parties to a complaint are expected to engage in good-faith negotiations and reach an amicable resolution. If that fails, the complainant can ask the DSB to appoint a three-member panel of trade experts to hear the case. The panel has nine months within which to issue its ruling. The losing party has the option of turning to a seven-member appellate body. If, after due process, a country's trade policies are found to violate WTO rules, it is expected to change those policies. If changes are not forthcoming, the WTO can authorize trade sanctions against the loser. Thus, the formation of WTO took care of many of the problems that existed during GATT.
83) What are the dimensions of global marketing strategy (GMS) that pertain to marketing management? Explain in detail giving examples.
Answer: GMS has three dimensions that pertain to marketing management. First, "concentration of marketing activities" such as promotional campaigns or pricing decisions is performed in one or a few country locations. The second, "coordination of marketing activities," refers to the extent to which marketing activities related to the marketing mix are planned and executed interdependently around the globe. Finally, "integration of competitive moves" is the extent to which a firm's competitive marketing tactics in different parts of the world are interdependent. In essence, GMS should enhance the firm's performance on a worldwide basis.
90) What are the major differences between global, foreign, and local consumer culture positioning? Why are these differences significant? Give examples of how companies are trying to lure customers using these positioning strategies.
Answer: Global consumer culture positioning (GCCP) is defined as a strategy that identifies the brand as a symbol of a particular global culture or segment. It has proven to be an effective strategy for communicating with global teens, cosmopolitan elites, and globe-trotting laptop warriors who consider themselves members of a transnational commerce culture. For example, Sony's slogan "My First Sony" is positioned as the electronics brand for youngsters around the globe with discerning parents. Benetton uses the slogan "United Colors of Benetton" to position itself as a brand concerned with the unity of humankind. Categories of products that lend themselves to this positioning are both associated with high levels of customer involvement and by a shared "language" among users. High tech products such as iPod, iPhone, MP3 players, video cameras, and all such technology-prone items fall into these categories. Foreign consumer culture positioning (FCCP) associates the brand's users, use occasions, or production origins with a foreign country or culture. Foster's Brewing Group's U.S. advertising proudly uses the brand's nation of origin in all of its print ads and other promotions as being Australian. Local consumer culture positioning (LCCP) strategy associates the brand with local cultural meanings, reflects the local culture's norms, portrays the brand as consumed by local people in the national culture, or depicts the product as locally produced for local consumers. Budweiser's U.S. advertising particularly focuses on local aspects.
90) Porsche relies on currency hedging rather than price increases to boost pretax profits on sales of its automobiles. What is the advantage of doing this, and how does hedging work?
Answer: Hedging exchange rate exposure involves establishing an offsetting currency position such that the loss or gain of one currency position is offset by a corresponding gain or loss in some other currency. Porsche manufactures all of its cars in Europe but generates about 45% of its sales in the United States. It therefore faces economic exposure stemming from the relative value of the dollar compared to the euro. Thus, Porsche is considered to be fully hedged, which means it takes currency positions to protect all earnings from foreign-exchange movements.
85) Assume that the market segment is judged to be large enough, and the strong competitors are either absent or deemed to be vulnerable, then is it safe to enter the country? Justify your answer by giving reasons.
Answer: If the market segment is judged to be large enough, and there are no strong existing or potential competitors, one should not assume that it is safe to enter the country. There are several other factors that can negatively impact a business. For example, significant regulatory hurdles may be present that limit market access. The company may also encounter cultural barriers or religious restrictions. Other marketing-specific issues can arise. For example, in India, three to five years are required to build an effective distribution system for many consumer products. Also, the approvals may take a considerably long period of time. Thus, apparent potential does not guarantee success. Managers have a difficult decision in such conditions. If there are certain prevailing conditions that require adaptation of products, then that should be taken into account. Also, it is important to consider the question of whether targeting a particular segment is compatible with the company's overall goals, its brand image, or established sources of competitive advantage.
83) What are the distinguishing features between Centrally Planned Socialism and Centrally Planned Capitalism? Give examples of countries which follow these systems.
Answer: In Centrally Planned Socialism, the state has broad powers to serve the public interest as it sees fit. Ownership of entire industries as well as individual enterprises belongs to the government. The elements of the marketing mix are not used as strategic variables. In Centrally Planned Capitalism, economic system command resource allocation is utilized extensively in an overall environment of private resource ownership. In Sweden, the government controls two-thirds of all expenditures, and the resource allocation is more "command" oriented than "market" oriented. This would be an example of centrally planned socialism although it can have elements of capitalism. China is an example of centrally planned socialism.
89) With the increase in oil prices, many of the Middle Eastern countries will find a hefty windfall income. Also, with greater involvement of world powers in the Middle Eastern region, there are certain unprecedented opportunities. What are some of the marketing issues that should be taken into consideration?
Answer: In Middle Eastern countries, the majority of the resident population is Arabs. Islam is the predominant religion. In spite of the apparent homogeneity, there are vast differences. The price of oil is the driving force behind all businesses. Although oil revenues help economically, they also widen the gap between rich and poor countries within the region. This disparity also creates political and social instability. As far as the business dealings are concerned, connections are keys for any success. Relationships with key government and business individuals open many doors. A predilection for bargaining is culturally ingrained. The Arab business person does business with the individual, not with the company. Understanding of Arab customs is very important. Women usually do not play an apparently prominent role in business.
85) What are some of the salient characteristics and differences between high- and low-context cultures?
Answer: In a low-context culture, messages are explicit and specific; words carry most of the communication power whereas in high-context culture, less information is contained in the verbal part of a message. Much more resides in the context of communication, including the background, associations, and basic values of the communicators. Japan and Saudi Arabia are examples of high-context culture, where a great deal of emphasis is placed on a person's values and position or place in society. In a low-context culture, such as the United States, Switzerland, or Germany, deals are made with much less information about the character, background, and values of the participants. In a high-context culture, a person's word is his or her bond. As a result, lawyers are much less important in high-context cultures. This also makes negotiations lengthy in high-context culture since several meetings or prodding is needed.
90) What is meant by Comparative Analysis and Market Estimation by Analogy? How can these be helpful in marketing research?
Answer: In global marketing research, it may be necessary to conduct comparisons of market potential and marketing performance in different countries or regional markets at the same point in time. This analysis can be intra-company or cross-national comparison. There may be differences even under similar conditions from one country to another. For example, catalog sales in the United States represent about 3% of overall retail sales. By comparison, catalog sales in Germany account for 5.8% of overall sales. This suggests that there is a catalog marketing opportunity in Germany. Sometimes data may not be available for a particular country or regional market. In such cases it is sometimes possible to draw an analogy. In other words the comparison is based on partial resemblance since data are not available. Time-series displacement is an analogy technique based on the assumption that an analogy between markets exists in different time periods. The time displacement method requires a marketer to estimate when two markets are at similar stages of development.
84) Describe how the global marketing strategy is different when compared to that of single country marketing.
Answer: In single country marketing, choosing a target market and developing a marketing mix are two important considerations. The same two aspects are also important in global marketing; however, they are viewed from a different perspective. There is standardization or adaptation in each of the marketing mix components in each country where business is conducted. Global marketing strategy has three additional dimensions that pertain to marketing management: concentration of marketing activities, coordination of marketing activities, and integration of competitive moves.
88) How can observational studies and focus groups be used in marketing research? What are the different methods by which these studies are conducted?
Answer: In the observation method, one or more trained observers or a mechanical device watch and record the behavior of actual or prospective buyers. The research results are used to guide marketing managers in their decision making. For example, observations are done as to how male or female customers open the door of cars and sit. This simple act can be of tremendous help in designing the doors of cars and the adjustment of seats. Similarly, observing how consumers are picking items in a grocery store or observing the items in shopping carts can give better understanding of the actual purchase behavior of consumers. It should be noted that since consumers are unaware of being watched, actual behavior can be recorded and interpreted. Marketers can also observe the eating behavior by observation or the plate wastages after dinner to assess food preferences of consumers. Companies using observation as a research methodology must be sensitive to public concerns about privacy issues, particularly if the subjects know that they are being watched. In focus group research, a trained moderator facilitates discussion of a product concept, a brand's image and personality, advertisement, social trends, or other related topic with a group comprised of 6 to 10 people. Selection of focus group participants has to be done very carefully since the number of participants is very limited. They should also meet the criteria which closely fit the overall population under study. Usually focus group meetings are conducted in a special equipment room in an undisturbed environment. The questions are carefully framed and answers are solicited from all participants in an organized manner. Recordings are made of the entire process and analyzed after the conclusion of the session. A one-way mirror or a video screening is simultaneously conducted where focus group participants are being watched. Also the trained moderator is connected by earphones with others including business managers, so that appropriate instant questions may be prompted to be used in discussion. Focus group research yields qualitative data that does not lend itself to statistical projection. Such data are extremely valuable in the exploratory phase of a project and are typically used in conjunction with data gathered via observation and other methods.
84) When a company invents a product or service, it should have a right to defend its creativity with intellectual patents. However, there are some countries like Italy and China where piracy and copyright violations are common. How can a corporation prevent this by having some built-in measures in products and services?
Answer: Individuals or companies sometimes find ways to exploit loopholes or other unique opportunities in patent, trademark, and copyrights. A company should take measures to protect itself from such piracy situations. For many of the technological products, certain codes can be built into the software program such that it is self-destructive or becomes inaccessible for those who would like to use piracy. One of the sure safe methods is to make the product or service of such a quality that it becomes very difficult or expensive for anyone to copy. One such example can be seen in the formulas of Coke and Pepsi beverages. The product has special features and it is distributed so cheaply such that there is no money left for the counterfeiters. Similarly, packages and containers can be made in such a way that it will become expensive or otherwise technologically impossible to copy. For example, in China, Budweiser cans have fluted edges that are difficult to manufacture. Thus, there can be some inherent qualities or manufactured processes which can make it difficult, if not impossible, to duplicate.
89) What are "interdependence techniques" in the analysis of data? What type of measurement is possible with this technique, and what are different methods that are used in marketing research?
Answer: Interdependence techniques show the interaction between variables and are comprised of factor analysis, cluster analysis, and multidimensional scaling (MDS). Factor analysis can be used to transform large amounts of data into manageable units. Specialized statistical programs can reduce or group the data by distilling out certain meaningful factors. These factors are selected by the program on the basis of attitudes and perceptions that can be closely aligned from a multitude of survey responses. Factor analysis is useful in psychographic segmentation studies. It can also be used to create perceptual maps. Cluster analysis allows the researcher to group variables into clusters that maximize within-group similarities and between-group differences. Cluster analysis shares some characteristics of factor analysis in that it does not classify variables as dependent or independent. It can also be used in psychographic segmentation. It is well suited to global marketing research because similarities and differences can be established between local, national, and regional markets of the world. Cluster analysis can also be used to perform benefit segmentation and identify new product opportunities. MDS is another technique for creating perceptual maps. When the researcher is using MDS, the respondent is given the task of comparing products or brands, one pair at a time, and judging them in terms of similarity. The researcher then infers the dimensions that underlie the judgments. MDS is particularly useful when there are many alternatives from which to choose and when consumers may have difficulty verbalizing their perceptions. To create a well-defined spatial map, a minimum of eight products or brands should be used.
84) The diversity of cultures around the world is also reflected in languages and communication. When KFC translated its slogan "Finger Licking Good" it became "Eat your fingers" in Chinese; similarly "Pepsi is for Generations" became "your grandparents will come out of the grave to drink Pepsi." Studies showing how linguists have divided the study of spoken or verbal language demonstrate how verbal and non-verbal communication can have an impact on marketing around the world.
Answer: Linguists have divided the study of spoken language into four main areas: syntax (rules of sentence formation); semantics (system of meaning); phonology (system of sound patterns); and morphology (word formation). Unspoken or nonverbal communication includes gestures, touching, and other forms of body language. Both the spoken and unspoken aspects of language are included in the broader field of semiotics, which is the study of signs and their meanings. Language is a crucial tool for communicating with customers and channel intermediaries. Words have different meanings in different cultures. For example post in America may refer to putting something on a bulletin board, whereas in British English it may mean mailing. Similarly, Miller Lite was considered to have less alcohol in Europe, whereas Diet Coke was considered as a dietary supplement in the Middle East. Changes were made to market Miller Lite as Miller Pilsner in Europe and Diet Coke as light coke in the Middle East. In addition to syntax and semantics, phonology can have an impact. For example there is no letter that sounds like P in Arabic so Pepsi sounds like Bebsi and Popeye's sounds like Bobeye's. Similarly, sounds of r and l are intermixed in Chinese. In the United States recently, Sioux Gateway City airport decided to keep the symbol "SUX" although there were a lot of comments about its phonology. On the other hand, the airport decided to use it in marketing by using the slogan "Fly SUX" thereby making it easy for people to remember it. Semantics can also have an impact, such as the word Esso has negative connotation in some languages; Nova (as in Chevy Nova) meant it does not move and Colgate means "go hang yourself" in Spanish. Also, nonverbal cues can have different meanings. In some cultures shaking the head from right to left is considered as yes whereas it means no in some other cultures. Shaking hands is considered as finalizing the deal in some cultures and in others it is just an introduction. There are different ways of bowing in Far Eastern cultures to indicate different aspects. Thus, verbal and nonverbal communications have a distinct impact on marketing practices.
88) What should a U.S. company do if competitors are willing to offer a bribe for business in a foreign country?
Answer: Managers have to realize the fact that bribery is a fact of life in world markets. It is not going to change overnight or based on how ethical the U.S. companies feel about their business. In fact, bribery payments are considered a deductible business expense in many European countries. Two alternative courses of action are possible. One is to ignore bribery and act as if it does not exist. This may be a very hard option. The other is to recognize the existence of bribery and evaluate its effect on the customer's purchase decision, in other words, treating it as just another element of the marketing mix. The overall value of a company's offer must be as good as, or better than, the competitor's overall offering, including bribe. If possible, a lower price, a better product, a better distribution system, or better advertisement/promotion can be undertaken to beat the competition. The best line of defense is to have a product or service that is superior to that of the competition, whether a bribe is included or not. Thus, a bribe should not be a factor that will sway the purchase decision.
81) What is "global marketing" and how does it differ from "regular marketing"? Giving examples of at least one major corporation, explain these differences.
Answer: Marketing is an organizational function and a set of processes for creating, communicating, and delivering value to customers. An organization that engages in global marketing focuses its resources and competencies on global market opportunities and threats. A fundamental difference between "regular marketing" and "global marketing" is the scope of activities. A company that engages in global marketing conducts important business activities outside the home-country market. For example, as Walmart expands into Guatemala and other Central America countries, it is implementing a market development strategy.
81) The ultimate threat a foreign government can pose toward a company is seizing assets. South Korea nationalized Kia, the nation's number three automaker, in the wake of the Asian currency crisis. How does this nationalization differ from expropriation and confiscation?
Answer: Nationalization is generally broader in scope than expropriation. It occurs when the government takes control of some or all of the enterprises in a particular industry. This is recognized by international law as a legitimate exercise of government power, as long as the act satisfies a "public purpose" and is accompanied by "adequate payment." On the other hand, expropriation refers to governmental action to dispossess a foreign company or investor. Compensation is generally provided, although not often in a prompt, effective, and adequate manner. Also, it may not match with international standards. If no compensation is provided, then it is referred to as confiscation. Confiscation is generally prohibited under international law and is considered an unfair practice.
88) The world's best-known cosmetics companies are setting sights on a lucrative new market segment: the emerging middle classes in countries such as Brazil, Russia, India, and China. What understandings and factors should be considered by these companies to be successful in markets in those countries?
Answer: Noting that there is no "one-size-fits-all" ideal of beauty, cosmetic marketers should consider the sensitivity to local cultural preferences. Each customer is free to have her own aspirations. They have to offer the best quality and the best product to satisfy local customers. Many Asian women use whitening creams to lighten and brighten their complexion. In China, white skin is associated with wealth. Companies have to understand what beauty means to Chinese women and what they look for. Product offerings and communications therefore have to be adjusted accordingly. Market research is critical to understanding women's preferences in different parts of the world. Japanese women prefer to use a compact foundation rather than a liquid. Humid conditions in tropical countries, like India, should be taken into account. How many times women clean their faces should be taken into account. In China, mass-market and premium brands should be considered in order to fulfill requirements of the top and general market. In India, the number of working women is increasing dramatically, and consumer attitudes are shifting. Due to advances in technology and access to television, women are getting more beauty conscious. Coloring gray hairs is also an important consideration for women in India. Thus, for each country different factors have to be considered since preferences for beauty products vary from country to country.
90) What are some of the concerns if European Union decides to sign a free trade agreement with the United States?
Answer: One of the issues related to this agreement would be the tariffs on goods imports and exports, which will amount to be a significantly large amount. Tariffs are only one part of the picture. Nontariff restrictions create major bureaucratic obstacles. The use of genetically modified agricultural products such as corn and soy, which are restricted in Europe, will be one of the issues. Another issue concerns the product labeling which is profoundly different in Europe compared to that in the United States. Other issue of concern is related to the cultural diversity. In parts of Europe, some hold view that American cultural exports such as Hollywood movies overwhelm the works of the local film producers. This has prompted European policymakers to demand "carve-outs" that exempt certain industries from the trade pact. All these aspects have to be addressed before any agreement can be signed and implemented.
87) Some people believe that marketing is relevant only in affluent, industrialized countries, whereas others believe that the role of marketing is to identify people's needs and wants worldwide, irrespective of the economy. Giving examples of companies involved in energy conservation and technology, support the latter argument.
Answer: People everywhere need affordable and safe drinking water. Recognizing this fact, Nestlé launched Pure Life bottled water in Pakistan. The Coca-Cola Company recently began to address dietary and health needs of low-income countries by developing a beverage, Vitango, which has several nutritional and health benefits. Technology is another area which can benefit countries all over the world. Intel's World Ahead is developing a $550 computer that is powered by a car battery. Hewlett-Packard engineers are working to develop solar-powered communication devices that can link remote areas to the Internet.
89) Colgate Total toothpaste is positioned as the brand that addresses all aspects of oral health. Such positioning is very important from the business point of view. How does positioning help in deciding on a marketing strategy? What are the differences between using "attribute or benefit" and "quality and price" as positioning strategy?
Answer: Positioning refers to the act of differentiating a brand in customers minds in relation to competitors in terms of attributes and benefits that the brand does and does not offer. It is the process of developing strategies for marketing purposes. It is frequently used in conjunction with the segmentation variables and targeting strategies. "Attribute or benefit" strategies are used to expose a particular product attribute, benefit or other special feature. Aspects such as economy, reliability, multiple uses, durability, and simplicity are very commonly used to describe the attributes of a product or service. For example, Visa's advertising theme "It's Everywhere You Want to Be" exposes its benefit of being useful at any place in the world. Thus, these types of slogans, themes, or jingles very cleverly outline the benefits or attributes of a product. A similar strategy that is used is related to "Quality and Price." This strategy can be considered in light of a continuum from high fashion/quality and high price to good value. Swatch watches advertise their quality, Swiss origin, as well as affordable price. This way price is always tied to the quality and durability of the product or service.
87) Applying Hofstede's typology, show how Power Distance and Gender Differentiation can influence the marketing of products and services in different countries.
Answer: Power Distance is the degree to which members of a particular society expect power to be unequally shared. Hong Kong and France are both high power-distance cultures; low power distance characterizes Germany, Australia, the Netherlands, and Scandinavia. The power distance dimension reflects the degree of trust among members of society. The higher the power distance, the lower the level of trust. Companies in high power-distance cultures prefer sole ownership of subsidiaries because it provides them with more control. On the other hand, companies in low power-distance cultures are more apt to use joint ventures. Masculinity describes a society in which men are expected to be assertive, competitive, and concerned with material success, and women fulfill the role of nurturer and are concerned with issues such as the welfare of children. Femininity, by contrast, describes a society in which the social roles of men and women overlap, with neither gender exhibiting overly ambitious or competitive behavior. Japan and Austria ranked highest in masculinity; whereas Spain, Taiwan, the Netherlands, and the Scandinavian countries were among the lowest. The masculinity-femininity dimension is likely to manifest itself in the relative importance of achievement and possessions (masculine values) compared with a spirit of helpfulness and social support (feminine values). An aggressive, achievement-oriented salesperson can be more successful in Austria, Japan, or Mexico than in Denmark. The Japanese managers may react negatively to a woman, especially if she is younger than they are.
81) What is psychographic segmentation, and how do marketers use it in targeting different world markets?
Answer: Psychographic segmentation involves grouping people in terms of their attitudes, values, and lifestyles. Respondents are carefully selected by asking questions to assess their attitudes, values, and lifestyles. There are different companies that provide services and help in assessing these psychographic variables. Different groups are given names based on the attributes which describe their attitudes, values, and lifestyles. Automakers rely on this segmentation since the purchase behavior of a considerable size of consumers is dependent on psychographic values. A psychographic study showed that Porsche buyers could be divided into several distinct categories. One of the categories, "Top Gun" was found to buy Porsches and expect to be noticed. Proud Patrons and Fantasists, on the other hand, found such conspicuous consumption as irrelevant. Thus, automakers can design autos based on the preferences of populations grouped under each category. It is preferable to market to a mind-set rather than a particular age group. For finding such a group, psychographic studies are important. These analyses are expensive and require careful interpretations. SRI International, one of the market research organizations, has developed VALS/VALS 2 analyses of consumers based on psychographic values. A research team in Europe identified four lifestyle groups: Successful Idealists, Affluent Materialists, Comfortable Belongers and Disaffected Survivors. The first two groups represent the elite, while the latter two represented the mainstream European consumers. It should be noted that the segmentation and targeting approach used by a company can vary from country to country. Methods that can truly assess a population segment of a country should be employed for psychographic segmentation.
82) London's Sunday Times reported that Mecca-Cola has become the drink which has come to be seen as "politically preferable" to Pepsi or Coke in many Muslim countries. Also, Danish products were boycotted in many Islamic countries in protest of an offensive cartoon that was printed in Danish newspapers. Considering these two examples, show how religion can have an impact on marketing.
Answer: Religion is one of the most important sources of a culture's beliefs, attitudes, and values. Hindus do not eat beef, which means that McDonald's does not serve hamburgers in India. There was a big uproar when it was found that McDonald's french fries had beef as one of the ingredients. Similarly, Jews do not combine fish and dairy products, which make McDonald's fish fillet a problem for them. Jews and Muslims do not eat pork, which rules out the use of bacon in many products sold by fast food operations. Restaurants in Malaysia have to declare that all meats are Halal or sacrificed in a specified religious way. In addition to religious requirements, religious sentiments also play an important role. After the incidents of September 2001, there was a distinct feeling of anti-Americanism in many parts of the world, particularly the Middle Eastern region. Mecca-Cola was an attempt to make indigenous products to compete with American ones. One of the concerns in allowing Turkey to join the European Union is that it is predominantly Islamic, whereas other members are comprised of Christians. All these cases show that religion plays a very important role in how people live as well as buy products and services.
84) What important lessons did Virgin chief executive Richard Branson learn in the mid-1990s when he launched Virgin Cola, directly targeting Coca-Cola's core market?
Answer: Starting a soft-drinks war with Coca-Cola was crazy. It was one of their highest profile business mistakes, though it was also one of the things that raised the profile of the Virgin name in America. Launching Virgin Cola they were having fun and reveling in bravado. However, taking on Coke taught them two lessons: how to make a great cola with a different taste; and how to antagonize a global business that brought in $28 billion in 2007, with profits of $5 billion. They underestimated the power and the influence of a global brand that epitomizes the strength and reach of American capitalism.
85) Although the ASEAN countries are geographically close, they have historically been divided in many respects. Elaborate on this statement and highlight the important economic development of member countries within ASEAN. How does Singapore represent a special case within the ASEAN nations?
Answer: The Association of Southeast Asian Nations (ASEAN) was established as an organization for economic, political, social, and cultural cooperation among its member countries. Brunei, Indonesia, Malaysia, the Philippines, Singapore, and Thailand were the original six members. Vietnam, Cambodia, Laos, and Myanmar joined later on. Individually and collectively, ASEAN countries are active in regional and global trade. However, all the above-mentioned countries were under different political orders, and the population is very different from the religious and cultural point of view. Some of these countries are advancing rapidly whereas others still have a long way to go. There are different natural resources in each of the member countries. Some have undergone political unrest and wars recently. For example, Singapore transformed itself from a British colony to a vibrant industrial power. One of the reasons for its success is its extremely efficient infrastructure. The Port of Singapore is the world's second-largest container port. It has a high standard of living, second only to Japan. There is 93-percent literacy rate and is very much advanced in business. Many foreign companies are attracted to Singapore. Singapore alone accounts for more than one-third of U.S. trading activities with ASEAN countries.
87) The formation and enlargement of the European Union have wide everlasting impact on marketing strategies and marketing mix. Discuss this giving example from member nations.
Answer: The European Union has concluded over 20 different trade pacts with other nations. The business environment in Europe has undergone considerable transformation with significant implications for all elements of the marketing mix. For example, there is harmonization of product standards, thereby reducing the number of adaptations needed in each country. Similarly, from a pricing point of view the environment has become more competitive. Common guidelines are also set for promotion and distribution. Thus, all components of the marketing mix are getting standardized and harmonized. Corporations are beginning to treat the entire region as one entity with very little adaptation. For example, France will be able to shop around for distributions of products or services and select the best one in any member country. This selection can be based on cost, quality, or local preferences. Food safety laws can also be made uniform with some modifications that can be adapted. The members in the European Union will find it easier to do business at any of the member countries including setting up of manufacturing plants or headquarters. It will also help in balancing the inventory and moving products from one country to another in case of shortages.
87) In the United States, the Foreign Corrupt Practices Act (FCPA) is a legacy of the Watergate scandal during Richard Nixon's presidency. Administered by the Department of Justice and the Securities and Exchange Commission, the act is concerned with disclosure and prohibition. What is this law concerned with, and why is it a subject of criticism by many?
Answer: The act concerns disclosure and prohibition. The disclosure part of the act required publicly held companies to institute internal accounting controls that would record all transactions. The prohibition part makes it a crime for U.S. corporations to bribe an official of a foreign government or political party to obtain or retain business. Payments to third parties were also prohibited when they can be channeled to some related official as a bribe. Some critics of the FCPA feel strongly that this act is a sort of regrettable display of moral imperialism. The problem is the extra-territorial extension and sovereignty of U.S. law. To impose U.S. laws, standards, values, and mores on American companies and citizens worldwide is considered wrong. A second criticism of the FCPA is that it puts U.S. companies in a difficult position vis-à-vis foreign competitors. It is perceived that the act adversely affects U.S. businesses overseas. Bribes offered by non-U.S. companies are considerable and can provide a competitive advantage to other companies.
84) Historically, most of the Latin American nations have witnessed decades of slow or no growth, crippling inflation, increasing foreign debt, protectionism, the bloated government payrolls, money laundering problems, and currency fluctuations. What measures are now being taken by countries in that region that will begin the process of economic transformations?
Answer: The allure of the Latin American market has been its considerable size, its strategic location, and huge resource base. Many countries are implementing economic reforms such as priority to have a balanced budget and privatization of certain industries. Free markets, open economies, and deregulation are becoming governmental priorities. Tariffs are being lowered, and free trades are being encouraged. Global corporations are encouraged by import liberalization, lower tariffs, and the potential for establishing more efficient regional production. Many observers envision a free trade area within the entire region. The four most important preferential trading arrangements in Latin America are the SICA, the Andean Community, the Common Market of the South (Mercosur), and the Caribbean Community and Common Market (CARICOM).
87) In an effort to "Americanize" the sound of the Beatles' recordings, a studio effect known as reverb was added to some tracks. From the global marketing perspective, what does this change represent?
Answer: The early albums released in the United Kingdom differed from releases in the United States as well as in other countries. EMI sent master tapes to various countries, often customizing them at the request of the local company. Reverb makes a dry (unprocessed) sound compared to the wetter echo-like sound preferred by Americans. In addition, some of the original mono and stereo tracks were remixed for the American market. Converting it to suit the local market is referred to as both product adaptation and product extension.
88) McDonalds, Philips Electronics, 3 M International and many other similar well known global corporations are operating in Central and Eastern Europe. Some countries in the region are still recovering from decades of command economies. What makes the region so attractive for global business corporations?
Answer: The extraordinary political and economic reforms that swept through Central and Eastern Europe in the 1990s attracted the attention of many corporations toward the new 430-million person market. The transition in the region from command to market economies has toppled a number of entrenched institutions. New pacts such as Central European Free Trade association (CEFTA) are being formed. The signatories are pledging cooperation in areas such as infrastructure and telecommunications. The governments of Russia and Belarus agreed to form a customs union and remove border posts between their two countries. Ford opened a $10 million vehicle assembly plant outside Minsk, predicting future economic growth in that region. The markets of central and Eastern Europe present interesting opportunities since they are in the process of transition. Also, with wage rates in these regions being much lower than those in Spain or Portugal, the region offers attractive locations for low-cost manufacturing.
89) In December 2012, President Barack Obama signed the Russia and Moldova Jackson-Vanik Repeal and Sergei Magnitsky Rule of Law Accountability Act. What does this law entail and how does it affect Russia-U.S. relationship?
Answer: The first part of the law normalizes trade relations with Russia and Moldova by repealing Jackson-Vanik, a law dating back to mid-1970s. At that time, the Soviet Union was a non-market economy and restricted the right of its citizens to emigrate abroad. Jackson-Vanik denied most-favored-nation trading status to any country that blocked emigration rights. However, the Soviet Union broke apart in 1991, Russia has transitioned to a market economy, and today its citizens are free to travel abroad and emigrate. Moreover, Russia joined the World Trade Organization in 2012. For these reasons, Jackson-Vanik is no longer relevant. The second part of the law is concerned with civil rights issues in Russia at the present time. Sergei Magnitsky was a Russian lawyer who uncovered evidence that Russian government officials had stolen $230 million in tax payments made by the Heritage Capital Management investment firm. When Magnitsky went public with his allegations in 2008, he was arrested. The law calls for the U.S. government to identify by name Russian officials believed to be complicit in Magnitsky's death; those persons will not be allowed to enter the United States and any assets held in the United States have been frozen.
90) List and briefly describe the forces affecting local integration and global marketing.
Answer: The forces affecting local integration and global marketing are (a) Multilateral Trade Agreements such as NAFTA which has expanded trade among the United States, Canada, and Mexico; (b) converging market needs and wants and the information revolution: the development of technology has a considerable impact on the market needs and wants; (c) transportation and communication improvements: the technology for transportation and communication is changing rapidly; (d) product development costs: new products require major investments and considerable time; (e) world economic trends: growing economies worldwide have an impact on global marketing; and (f) leverage: it is an advantage that a company enjoys by virtue of having experience in more than one country.
82) Authors Michael Czinkota and Ilka Ronkainen identified four specific environmental factors that may require international research efforts to be conducted differently than domestic research. Describe those factors to outline the differences.
Answer: The four specific environmental factors that may require international research efforts to be conducted differently than domestic research are: (1) Researchers must be prepared for new parameters for doing business. The requirements and ways in which rules are applied may differ from country to country. (2) A "cultural mega-shock" may occur as company personnel come to grips with a new set of culture-based assumptions about conducting business. (3) A company entering more than one new geographic market faces a burgeoning network of interacting factors. Research may help prevent psychological overload in that case. (4) Company researchers may have to broaden the definition of competitors in international markets to include competitive pressures that would not be present in the domestic market.
82) In Malaysia and Saudi Arabia, it is common to see that restaurants have signs declaring that all food is "Halal." Also, it is seen that courts handle marriages, divorces, distribution of family assets, and business practices by the "Sharia." What are these tenets and how do they have an impact on international business?
Answer: The legal system in many Middle Eastern and some Far Eastern countries is identified with the laws of Islam. These laws are associated with "the one and only one God, the Almighty." In Islamic law, the sharia refers to a comprehensive code governing Muslim conduct in all areas of life, including business. The code is primarily derived from two sources. The first and foremost source is the Koran or the Holy Book that is a record of the revelations made to the Prophet Mohammed by Allah (God). The second source is the Hadith which is an interpretation of Koran based on the sayings and practices of Prophet Muhammad. In particular, the Hadith spells out the products and practices that are Haram (forbidden) compared to Halal (allowed). Any non-Muslim doing business in Islamic countries should be aware of the Islamic laws which have wide implications for commercial activities including advertisement and promotion.
86) Using McDonald's as an example, show how effective global marketing can be successfully achieved.
Answer: The particular approach to global marketing that a company adopts will depend on industry conditions and its source or sources of competitive advantage. McDonald's standardized product is Big Mac which is localized in various countries, such as McAloo Tikka Burger in India. Similar products with local slang names were used adapting to tastes in different countries. For promotion the standardized slogan "I'm lovin' it" is used whereas individual promotion is used in different countries. Freestanding restaurants are a standardized version, which is localized in several countries by having kiosks or home delivery. Similarly, the average price of Big Mac is used as a standard which is localized on the basis of currency fluctuation and affordability.
81) There are considerable differences and similarities among world cultures. This makes the task of the global marketer much more difficult. Giving examples, show what factors have to be taken into account when planning marketing strategy for different parts of the world.
Answer: The task of the global marketer is twofold based on the differences and similarities prevalent worldwide. First of all, marketers must study and understand the country cultures in which conduction of business is planned. Secondly, marketers must incorporate this understanding into the marketing planning process. Several adaptations will be needed in developing strategies. Deep cultural understanding can actually be a source of competitive advantage for global companies. It is not only the language but deep understanding of culture and developing a relationship that is of paramount importance. In a new geographic market it requires a combination of tough-mindedness and generosity. While marketers should be secure in their own convictions and traditions, generosity is required to appreciate the integrity and value of other ways of life as well as points of view. People should overcome the prejudices that are a natural result of the human tendency toward ethnocentricity.
87) After evaluating the identified segments, decisions have to be made whether to pursue a particular opportunity or not. Assuming the decision is made to proceed, an appropriate targeting strategy must be developed. Explain the basic categories of target marketing strategies and how they can be implemented.
Answer: The three basic categories of target marketing strategies are: standardized marketing, concentrated marketing, and differentiated marketing. Standardized global marketing is analogous to mass marketing in a single country. It involves creating the same marketing mix for a broad mass market of potential buyers. It is also known as undifferentiated target marketing since it is based on the premise that a mass market exists around the world. Product adaptation is minimized, and a strategy of intensive distribution ensures that the product is available in the maximum number of retail outlets. The appeal of standardized global marketing is due to the lower production costs. The concentrated target marketing involves devising a marketing mix to reach a niche. A niche is a single segment of the global market. For example, in cosmetics, Chanel has targeted the upscale, prestige segment of the market. Concentrated targeting is also the strategy employed by the hidden champions of global marketing—companies unknown to most people that have succeeded by serving a niche market that exists in many countries. These companies define their markets narrowly and strive for global depth rather than national breadth. The narrowing of market definition is the key principle in this strategy. The third category differentiated global marketing, represents a more ambitious approach than concentrated target marketing. It is also known as multi-segment targeting. It entails targeting two or more distinct market segments with multiple marketing mix offerings. This strategy allows a company to achieve wider market coverage. For example, in the sport utility vehicle segment, Rover has a Range Rover at the high end of the market. A scaled down version, the Land Rover Discovery, is offered which competes directly with the Jeep Grand Cherokee. The Freelander, its newest vehicle, has been on sale in Europe for several years. Thus, there is a multi-pronged approach to marketing.
81) Global competition intensifies the need for effective MIS and business intelligence that are accessible throughout the company. How can IT provide valuable tools in fulfilling this need as well as conducting global marketing research?
Answer: There are different IT programs that can provide valuable tools for marketing. EDI (Electronic data interchange) links with vendors to enable retailers to improve inventory management and restock popular products in a timely, cost-effective manner. Also, effective consumer response (ECR) is another program which allows management to work more closely with vendors on stock replenishment. ECR systems utilize electronic point of sale (EPOS) data gathered by checkout scanners that help retailers identify product sales patterns as well as record consumer preferences separated by geographical areas. All these tools are also helpful in improving the ability of businesses to target consumers and increase loyalty. Customer relationship management (CRM) is another method by which a relationship is developed with the customer. It helps in determining which customers are most valuable and to react in a timely manner with customized product and service offerings that closely match customer needs. It also makes employees more productive and enhances corporate profitability. It also benefits customers by providing value-added products and services. Data warehouses store a company's CRM system as well as other IT systems. These data warehouses can provide multiple uses such as helping retailers with multiple store locations fine-tune their product assortments. In addition to Internet, intranet can be a valuable tool, which can connect individuals within a company on a private basis.
90) There are specific characteristics of innovations that affect which innovations are adopted. Define those characteristics giving examples of products or services.
Answer: There are five different characteristics that are important in the adoption of innovations. They are: 1. Relative advantage. This involves a comparative assessment of the existing products or methods. If a product has a substantial relative advantage, it is likely to gain quick acceptance. The popularity of jump drives is an example for their preference over floppy disk. 2. Compatibility. This concerns with the extent to which a product is consistent with existing values and past experiences of adopters. For example, the first consumer VCR, the Sony Betamax, failed because it could only record for one hour. Most customers wanted to record for longer periods of time and thus selected VHS-format, although the recording quality of Sony-Betamax was superior to VHS. 3. Complexity. The degree to which an innovation or new product is difficult to understand, operate, and use. The more complex a product is, the slower will be its adoption. The new digital cameras are an example of their slow adoption since their operations are very complex. 4. Divisibility. This is the ability of a product to be tried and used on a limited basis without great expense. There are wide discrepancies in income levels around the world as well as the storage conditions. Smaller cans of Coke and Pepsi are popular in many countries, with affordable prices and less storage space requirement. 5. Communicability. It is the degree to which benefits of an innovation or the value of a product may be communicated to a potential market. Many of the software programs go unsold since their benefits are not fully communicated to customers. These characteristics give a clear outline of what is needed for an innovation to be successful.
82) A laptop manufactured in Canada and imported by Chile would not be subjected to duty. If the same laptop was manufactured in the USA and exported to Chile, it will have to pay duty. In order to avoid duty, can the manufacturer in the USA send the computer via Canada?
Answer: There is a Free Trade Area (FTA) which is formed when two or more countries agree to eliminate tariffs and other barriers that restrict trade. However, there are rules of origin that discourage the importation of goods into the member country with the lowest external tariff for transshipment to one or more FTA members with higher external tariffs. Thus, even though the laptop can be shipped via Canada, it will have the label as "made in USA" and therefore subject to duty.
85) The newly independent countries of the former Soviet Union present an interesting situation: income is declining, and there is considerable economic hardship. The potential for disruption is certainly high. Are they problem cases, or are they attractive opportunities with good potential for moving out of the low-income category?
Answer: These countries are good example of risk-reward trade-off. Many companies have taken the plunge, but many others are still assessing whether to take risk. Belarus and Turkmenistan are rated quite low in the rankings in terms of economic freedom. Russia itself has slipped within the upper-middle-income category. However, there are still some former Soviet-dominated countries which have opportunities for economic growth. It much depends on the actions taken by the Soviet republic. For example, the launching of a military action in Georgia creates a ripple effect and causes economic and political instability.
84) A decade ago, a number of countries in Central Europe, Latin America, and Asia were expected to experience rapid economic growth. Today much attention is focused on opportunities in Brazil, Russia, India, and China. Give reasons for this shift using an example of a manufacturer.
Answer: These four countries are collectively known as BRIC. Microsoft's experience illustrates the nature of the market opportunity in these countries: In fiscal 2008, the software giant's collective revenues from BRIC grew 54%, compared with overall global revenue growth of 18%. Experts predict that the BRIC nations will be key players in global trade even as their track records on human rights, environmental protection, and other issues come under closer scrutiny by their trading partners. The BRIC government leaders will also come under pressure at home as their developing market economies create greater income disparity.
87) Grey China Advertising agency gathers a wealth of information about attitudes and buying patterns of the Chinese in its Grey China Base Annual Consumer Study. Recent findings point to growing concerns about the future, Westernization of grocery purchases, growing market saturation, increasingly discerning customers and a rise in consumer willingness to try new products. These data can be very inconsistent since conflicting findings were reported by different agencies. For example, data gathered by Euromonitor International estimates soft-drink consumption at 23 billion liters in China, while Coca- Cola's in-house marketing research team places the figure at 39 billion liters. Similar differences were noted in other data published by different agencies. What is the best approach in such situations so that finite decisions can be made? What are the differences between latent and incipient markets?
Answer: These types of discrepancies are expected due to the research methodology, design, analyses and scores of other factors. In such situations, and in countries where such data are not available, researchers must first estimate the market size, the level of demand, or the rate of product purchase or consumption. A second research objective in existing markets may be assessment of the company's overall competitiveness in terms of product appeal, price, distribution, and promotional coverage and effectiveness. Researchers may be able to find out special aspects or weaknesses in competitors' way of doing business. Unserved market segments may also be discovered. In some instances, there is no existing market to research. Such potential markets can be further subdivided into latent and incipient markets. A latent market is, in essence, an undiscovered market segment. It is a market in which demand would materialize if an appropriate product or service were made available. In a latent market, demand is zero before the product is offered. An incipient market is a market that will emerge if a particular economic, demographic, political, or socio-cultural trend continues. A company is not likely to achieve satisfactory results if it offers a product in an incipient market before the trends have taken roots. After the trends have had a chance to unfold, the incipient market will become latent and, later, an existing market.
88) Reference to one's own cultural values or self-reference criterion (SRC) can create a cultural myopia. It can consciously or unconsciously create considerable problems for marketing professionals. Using Walt Disney's decision to build a theme park in France, address the problem, following a systematic framework.
Answer: To address the problem and to eliminate or reduce cultural myopia, a systematic four-step framework is proposed as described below: Step 1. Define the problem or goal in terms of home-country cultural traits, habits and norms. Disney executives believe there is virtually unlimited demand for American cultural exports all over the world. Disney has a track record in exporting its American management system as seen by the success of Tokyo Disneyland. However, Disney policies prohibit sale or consumption of alcohol inside its theme parks. Step 2. Define the problem or goal in terms of host-country cultural traits, habits, and norms. Make no value judgments. Europeans in general and the French in particular are sensitive about American cultural imperialism. Consuming wine with the midday meal is a long-established custom in France. Many Disney characters are based on European folklore. Step 3. Isolate the SRC influence and examine it carefully to see how it complicates the problem. The differences noted in earlier steps suggest strongly that the needs upon which the American and Japanese Disney theme parks were based did not exist in France Step 4. Redefine the problem without the SRC influence and solve for the host-country market situation. A modification in design of the theme park that is in keeping with French and European cultural norms will solve the problem. Focus on French identity on the park.
86) For years, Coca-Cola Corporation did not enter India since the government wanted some kind of disclosure of their trade secrets. Why are the trade secrets so important and what happens if a licensee or a government gains access to the licensor's trade secret?
Answer: Trade secrets, like the formula of Coke, are confidential information or knowledge that has commercial value and is not in the public or government domain. Careful steps have to be taken by those who have access to these trade secrets. Trade secrets include manufacturing processes, formulas, designs, and customer lists. To prevent disclosure, the licensing of unpatented trade secrets should be linked to a confidentiality contract with everyone who has access to the protected information. In the United States, trade secrets are protected by state law rather than federal statute. The U.S. law provides trade secret liability against third parties that obtain confidential information through an intermediary. Remedies include damages and other forms of relief.
83) Why does NAFTA create a free trade area as opposed to a customs union or a common market? Explain the difference giving examples.
Answer: Under a customs union, in addition to eliminating internal barriers to trade, members agree to the establishment of common external tariffs. For example, the EU and Turkey initiated a customs union in an effort to boost two-way trade. In a common market, in addition to the removal of internal barriers to trade and the establishment of common external tariffs, free movement of factors of production such as labor and capital is allowed. NAFTA helps in promoting economic growth through tariff elimination, expanded trade and investment, as well as no restrictions on labor and other factor movements within the three nations. The benefits of continental free trade will enable all three countries to meet the economic challenges of the decades to come. The gradual elimination of barriers to the flow of goods, services, and investment, coupled with strong protection of intellectual property rights will further benefit businessmen, workers, farmers, and consumers. The agreement also leaves the door open for discretionary protectionism.
82) What is meant by competitive advantage? Explain, giving examples as to how globalization presents companies with unprecedented opportunities to reconfigure themselves.
Answer: When a company succeeds in creating more value for customers than its competitors, that company is said to enjoy "competitive advantage." It is measured relative to rivals in a given industry. For example, Coca-Cola and Pepsi are trying to maintain a competitive advantage in global markets. Globalization presents companies with unprecedented opportunities as well as challenges. Achieving competitive advantage in a global industry requires executives and managers to maintain a well-defined strategic focus. Globalization provides companies to develop new products, get new ideas, develop markets, expand brand recognition, and eventually profits.
84) Many of the fast food operations are entering markets in Middle Eastern countries. In the United States, breakfast items are very popular and are responsible for a bulk of profit from sales, primarily through drive-in customers. However, to their dismay, managers found that there was practically no demand for breakfast items. Firstly, due to hot weather conditions, people sleep late and wake up late. Secondly, they do not eat burgers, and sausage or bacon is prohibited food. Also, drive-in business is not popular since people go to work at different periods of time. Explain the possible reason(s) behind such a decision and account for its/their failure.
Answer: When conducting research in a foreign country one has to be completely free from any kind of bias or prejudice. A person's home-country values and beliefs may consciously or unconsciously influence the assessment of a foreign culture or country. This is referred to as SRC (self-reference criterion). The SRC tendency underscores the importance of understanding the cultural environments of global markets. As in the above case, assumptions based on home-country marketing success turned out to be wrong when applied in a Middle Eastern country. A marketing program that is successful in one country does not guarantee success in another country. Thus, marketers must be aware of the SRC and its impact. Such awareness can have several positive effects. It can enhance management's willingness to conduct market research in the first place. Also, an awareness of SRC can help in ensuring the validity of research with minimal home-country or second-country bias. In other words, the research will have potentially useful results which managers will be able to accept and implement.
63) Based on the size of the market in U.S. dollars, the second highest consumer products are: A) luxury goods. B) cell phones. C) cigarettes. D) bottled water. E) recorded music.
a
32) Suppose you have a friend from India who is a lifelong vegetarian and who does not like McDonald's because the company sells hamburgers in many countries. Which of the following describes your friend? A) "vegetarianism" represents a value, "dislike McDonald's" represents an attitude B) "vegetarianism" represents an attitude, "dislike McDonald's" represents a value C) "vegetarianism" and "dislike McDonald's" both represent an attitude D) "vegetarianism" represents a value, "dislike McDonald's" represents a belief E) "vegetarianism" and "dislike McDonald's" both represent values
a
34) Global marketing authority, Theodore Levitt, has noted that many ethnic and regional foods—sushi, for example—are enjoying popularity in many countries of the world. This observation is known as: A) the pluralization of consumption. B) the ethnicitization of consumption. C) the democratization of consumption. D) the sophistication of consumption. E) the domestication of consumption.
a
35) Market capitalism is an economic system in which: A) individuals and firms allocate resources and production resources that are privately owned. B) the state has broad powers to serve the public interest as it sees fit. C) market resource allocation is commanded by both private and state ownership. D) there is no correlation between economic freedom and a nation's economy. E) market-oriented economies function in an identical manner.
a
36) Starbucks is building on its loyalty card and rewards program in the United States with a smartphone app that enables customers to pay for purchases electronically. The app displays a bar code that the barista can scan. This is an example of: A) Market Penetration. B) Market Development. C) Market Diversification. D) Product Development. E) Global Marketing.
a
38) A true economic union requires: A) political unity. B) social services. C) welfare. D) regional development. E) taxation.
a
40) Custom unions or a common market does not create a free trade area as compared to NAFTA due to: A) no common external tariffs. B) decreased production costs. C) reduced competition. D) ease of exporting commodities. E) creation of a continental demand.
a
43) A global segment is referred to as "global teens" which includes: A) people between the ages of 12 and 19. B) affluent, well-traveled persons. C) young global travelers. D) technology professionals. E) persons having power.
a
43) In China, Dell had to find a meaningful interpretation of "direct sales." A literal translation results in zhi xiao which is the Chinese term for "illegal pyramid marketing schemes." To counteract the negative connotation, Dell's sales representatives began using the phrase zhi xiao ding gou, which translates as: A) direct orders. B) direct marketing. C) pyramid orders. D) pyramid scheme. E) direct shipping.
a
43) Low-income countries have a GNI per capita of $1,025 or less. The general characteristics shared by countries at this income level include all of the following except: A) high literacy rates. B) high birth rates. C) heavy reliance on foreign aid. D) political unrest. E) high agricultural population.
a
45) In West Africa, Burkina Faso, the Ivory Coast and Senegal are former French colonies, while Nigeria, Sierra Leone, and Ghana are former British colonies. Based on this information, which of the following would be correct? A) Burkina Faso, the Ivory Coast and Senegal are civil-code countries, while Nigeria, Sierra Leone, and Ghana are common-law countries. B) Burkina Faso, the Ivory Coast and Senegal are common-law countries, while Nigeria, Sierra Leone, and Ghana are civil-code countries. C) In West Africa, Ivory Coast and Senegal are the only common-law countries. D) All the West African nations mentioned above are likely to be civil-code countries. E) All the West African nations mentioned above are likely to be common-law countries.
a
46) From the global marketing perspective, the customization of the Beatles' records is a good example of: A) product adaptation. B) market penetration. C) diversification. D) product development. E) marketing mix.
a
46) Which of the following lists some of the steps in the market research process in the correct order? A) determine information requirement→problem definition→choose unit of analysis→examine data availability→assess value of research B) problem definition→assess value of research→determine information requirement→choose unit of analysis→examine data availability C) examine data availability→problem definition→choose unit of analysis→assess value of research→determine information requirement D) choose unit of analysis→assess value of research→problem definition→determine information requirement→examine data availability E) examine data availability→assess the value of research→problem definition→presentation
a
47) In an effort to "Americanize" the sound of the Beatles' recordings, a studio effect known as reverb was added to some tracks. This is an example of: A) product adaptation. B) market penetration. C) diversification. D) product development. E) marketing mix.
a
48) In a recent case, Revlon sued United Overseas Limited (UOL) in the U.S. District Court for the Southern District of New York for breach of contract. UOL countered by asking the court to dismiss the claim since they are not operating in that area. Revlon cited the presence of a UOL sign above the entrance to the offices of a New York company in which UOL had a 50-percent ownership. The court dismissed UOL's claim. This is an issue related with: A) jurisdiction. B) antitrust. C) dilution of equity. D) bribery and corruption. E) intellectual property.
a
49) A formal legal document that gives an inventor the exclusive right to make, use, and sell an invention for a specified period of time is known as: A) patent. B) copyright. C) trademark. D) trade secret. E) trade dress.
a
49) Insisting on competitive bidding can cause complications in: A) low-context cultures B) high-context cultures. C) low and high context cultures. D) Korean cultures. E) Japanese cultures.
a
64) When a trained person is recording the items selected in a grocery cart or basket, the research method is known as: A) observation. B) survey research. C) focus study. D) secondary data collection. E) personal interviews.
a
50) Considering the progress, attempts to achieve integration in Central America has been described as: A) uncoordinated. B) coordinated. C) efficient. D) costly. E) productive.
a
50) Engineers at a company in a developing country study an American computer chip design, copy it, and produce identical chips that are then sold to local computer makers. What form of intellectual property has been wrongly appropriated? A) patent B) copyright C) trademark D) trade secrets E) technological
a
54) McDonald's serves McAloo Tikki Burger in India, McRice Burger in Malaysia, McOZ Burger in Australia, Kiwi Burger in New Zealand, and McHuevo Burger in Uruguay and McSamurai Burger in Thailand. These menu variations are examples of: A) a combination of global and local marketing mix elements. B) a reflection of failure of U.S. menu items in those countries. C) a deviation from successful marketing practices. D) a replacement of standard menu names with fancy names. E) a selection of menu items that can be sold eventually in U.S. markets.
a
55) Upper-middle-income countries are also known as: A) Industrializing countries. B) BRIC countries. C) Stabilized countries. D) Manufacturing countries. E) Agricultural countries.
a
57) Which one of the ASEAN members has the World's second-largest container port? A) Singapore B) Thailand C) India D) Philippines E) Brunei
a
59) The decision by Toyota executives to introduce the Sienna minivan in the U.S. market was based on their study of a(n) ________ market. A) existing B) latent C) parallel D) incipient E) global
a
62) The introduction of the euro by EU resulted in multifaceted advantages which include: A) elimination of costs associated with currency conversion. B) fixed exchange rate worldwide. C) elimination of paper currency and coins. D) withdrawal of French Francs from circulation. E) a choice for using local or European currency.
a
62) Which of the following statements is correct? A) The Paris Convention protects patents, the Berne Convention protects copyrights. B) The Paris Convention protects copyrights, the Berne Convention protects patents. C) The Berne Convention and Paris Convention are different names for the same thing. D) Neither the Berne Convention nor the Paris Convention is concerned with intellectual property. E) The International Union for the Protection of Literary and Artistic Property is different from the Berne Convention.
a
66) Nissan's earlier vehicles were difficult to start in many parts of the United States during the cold winter months. In northern Japan, it was customary for many car owners to put blankets over the hoods of their cars during winter months. Nissan's assumption was that Americans would do the same thing. This is an example of: A) ethnocentric orientation. B) polycentric orientation. C) regiocentric orientation. D) geocentric orientation. E) geopolitic orientation.
a
67) To speed adoption of a new product, the marketing team should: A) ensure that features and benefits can be communicated or demonstrated. B) design the maximum amount of complexity into the product. C) discourage limited use on a "trial" basis. D) attempt to make a clean break with existing customer values. E) rely heavily on word-of-mouth marketing.
a
68) A proposed merger between two Swiss-based global pharmaceutical companies, Ciba-Geigy AG and Sandoz AG, would be subject to review by regulators from which of the following? A) European Commission B) UN Conference on International Trade Law C) International Chamber of Commerce D) International Court of Justice E) none of the above
a
69) Together, innovators and early adopters make up about ________ of the potential market for a new product. A) 16.0% B) 26.0% C) 34.0% D) 46.0% E) 13.5%
a
70) In Mexico City, only 55-60% of the population owns a telephone. The number drops to less than 50% in Guadalajara and Monterey, and 35% or lower in other cities. This will complicate the task of market researchers hoping to use a telephone survey to obtain a ________ of the Mexican population. A) probability sample B) convenience sample C) secondary sample D) focus group sample E) quota sample
a
70) Measuring elevator populations in countries measured as units installed per thousand people gives an estimate of the market for elevators. That China has about one half an elevator per thousand people is indicative of: A) low product saturation level. B) high product saturation level. C) high population level. D) high technological level. E) low technological level.
a
71) A type of advantage that a global company possesses by virtue of the fact that it has experience in more than one country is referred to as: A) Leverage. B) Transferability. C) Flexibility. D) Capability. E) Enability.
a
71) OPEC can be considered as a "cartel" which is a group of separate companies that collectively: A) sets prices, controls output, or takes other actions to maximize profits. B) dictates how other countries should use their products. C) produces more products in order to beat the competition. D) conducts activities that are considered illegal in the United States. E) works on forming a union against management of other companies.
a
74) Some of Body Shop's recent advertising has emphasized the difference between the company's principles and those of "mainstream" cosmetics companies on such issues as animal testing. As described here, Body Shop's ads illustrate positioning by: A) competition. B) niche. C) quality/price. D) attribute/benefit. E) culture.
a
74) To the extent that a country sells more goods and services abroad than it buys, there will be: A) a greater demand for its currency. B) a surplus production of goods and services. C) a scarcity of goods and services within the country. D) a need for revaluation of its currency. E) time for fluctuating its currency.
a
75) The top global merchandise exporter is: A) China. B) Germany. C) the United States. D) Japan. E) Korea.
a
75) When a country like China is experiencing rapid economic growth, policymakers are likely to: A) look more favorably on outsiders. B) look less favorably on outsiders. C) experience more resistance toward outsiders. D) feel threatened by outsiders. E) None of the above
a
19) Grocery distribution companies in Brazil use logistics software to route their trucks; meanwhile, horse-drawn carts are still a common sight on many roads.
true
75) Which of the following is arranged starting with the highest level of environmental sensitivity and ending with the lowest level? A) food→computers→integrated circuits B) integrated circuits→food→computers C) integrated circuits→computers→food D) computers→food→integrated circuits E) none of the above
a
76) Consumers shopping for high-touch products, such as fine perfume, are generally energized by ________ motives. A) emotional B) rational C) both emotional and rational D) neither emotional nor rational E) high-tech
a
76) The ________ the level of environmental sensitivity for a given product, the ________ the need for managers to address country-specific economic, regulatory, technological, social and cultural environmental conditions. A) greater; greater B) lower; greater C) greater; lower D) lower; lower E) stronger; greater
a
80) Italy recently introduced the Reguzzoni-Versace Law which is intended to regulate trade in textiles, leather, and footwear. All of the following statements pertaining to the law are correct except: A) at least four stages of production should occur in Italy for the product to be labeled as "Made in Italy." B) the countries in which the remaining production stages took place must be identified. C) Brussels objected on grounds that the law conflicts with restrictions provided by the European Union. D) EU regulators view the law as "protectionist." E) the law is more stringent than the existing laws where only one production stage has to occur in the country of origin.
a
51) The country that withdrew from the original members of the Andean Community is: A) Bolivia. B) Chile. C) Ecuador. D) Peru. E) Venezuela.
b
52) About 70% of Ecuador's flower harvest is exported to: A) Bolivia. B) the United States. C) Colombia. D) Peru. E) Venezuela.
b
31) When you call United Airlines for a reservation on a toll-free number and get a response from an operator in Mumbai, this is an example of: A) anti-globalization. B) global marketplace. C) multilingual expression. D) discrimination. E) E-ticketing.
b
32) One of the key advantages of an EDI (Electronic Data Interchange) system is: A) it allows easy access to all company data to vendors. B) its transaction formats are universal. C) it allows third-party transmission connections to company data. D) it saves both time and money by using different languages. E) vendors receive orders by voice mail.
b
32) The World Trade Organization, which came into existence on January 1, 1995, is the successor of another organization with the abbreviation: A) DSB. B) GATT. C) FTAA. D) NAFTA. E) ASEAN.
b
33) Categories of political risk listed by EIU (Economist Intelligence Unit) include all of the following except: A) war. B) political turmoil. C) bureaucracy. D) corruption. E) crime.
b
35) A fundamental difference between regular marketing and global marketing is: A) the lack of marketing mix. B) the scope of activities. C) the lack of strategic planning. D) the focus on resources. E) the lack of communication
b
35) Which of the following is an IT tool designed specifically to help retailers work more closely with vendors on stock replenishment? A) BOLD B) ECR C) data warehouse D) projection E) EDI
b
36) The process of global market segmentation begins with the choice of one or more variables to use as a basis for grouping customers. All of the following are variables that are commonly used except: A) demographics. B) polycentrics. C) behavioral characteristics. D) benefits sought. E) psychographics.
b
36) What do value added taxes (VAT) encourage in countries such as China? A) They make trademarks and copyrights more valuable. B) They result in cross-border shopping and smuggling. C) They make it harder to bribe officials. D) They protect companies from antitrust scrutiny. E) Global companies refrain from offering bribes.
b
36) Which of the following can be defined as a business philosophy that values two-way communication between a company and individual customers? A) ECR B) CRM C) EDI D) EPOS E) BOLD
b
37) After Fidel Castro took power in Cuba in 1959, his government seized control of American property without paying compensation. Coca-Cola, DuPont, Texaco, and dozens of other American companies have filed claims against Cuba seeking financial settlements. Which of the following terms most specifically describes the action Castro took against these companies? A) nationalization B) confiscation C) expropriation D) internationalization E) deportation
b
37) Starbucks is entering India via an alliance with the Tata Group. Phase 1 calls for sourcing coffee beans in India and marketing them at Starbucks stores throughout the world. This is an example of: A) Market Penetration. B) Market Development. C) Market Diversification. D) Product Development. E) Regular Marketing.
b
38) American Nancy McKinstry recently became the new CEO at Dutch publisher Wolters Kluwer. As Ms. McKinstry noted, she had to drop the word "aggressive" in describing her strategic plan to company managers. She said, "I learned that the word has a negative connotation to a lot of Europeans. I was coming across too hard, too much of a results-driven American to the people. I needed to get on board so I started describing our strategy as 'decisive' and that made all the difference." Which of the following grammar topics is the critical element in this passage? A) syntax B) semantics C) morphology D) phonology E) semiotics
b
38) The essence of marketing worldwide is to surpass the competition in creating perceived value, which can be represented as: A) Value = Price/Benefits. B) Value = Benefits/Price. C) Value = Benefits × Price. D) Value = Benefits - Price. E) Value = Benefits + Price.
b
39) The marketing mix is integral to the value equation which is represented by: A) Value = Price/Benefits. B) Value = Benefits/Price. C) Value = Benefits × Price. D) Value = Benefits - Price. E) Value = Benefits + Price.
b
41) Anheuser-Busch and Miller Brewing both experienced market failures in the United Kingdom when they used the phrase "light beer" which was misinterpreted as: A) being low in calories. B) having reduced alcohol levels. C) having light color. D) having less quality. E) having less quantity.
b
42) According to Michael Porter, a global industry is one in which ________ can be achieved by integrating and leveraging operations on a worldwide scale. A) marketing mix B) competitive advantage C) cross border infiltration D) ration analysis E) production capability
b
42) NAFTA creates a free trade area in North America. However, Mexican avocado growers: A) cannot hire illegal immigrants. B) can only ship avocados to the United States in winter months. C) have no quotas for the quantity of avocados shipped to the United States. D) cannot impose tariffs of their own. E) None of the above
b
43) NAFTA creates a free trade area, as opposed to a customs union or a common market, due to the fact that: A) the agreement does not leave the door open for discretionary protectionism. B) the governments of all three nations decided to eliminate tariffs. C) the issue of illegal immigration from Mexico to the United States is resolved. D) restrictions are imposed on the use of goods, services, and investments. E) restrictions are imposed on labor movements among members.
b
44) Colgate discovered that in Spanish colgate is a verb form that means "go hang yourself." Whirlpool found that consumers in Italy, France, and Germany had trouble pronouncing the name. These are examples which show the importance of ________ in global marketing. A) syntax and morphology B) phonology and morphology C) syntax and semantics D) semantics and phonology E) semantics and morphology
b
44) The allure of the Latin American market has been its: A) lack of inflation. B) considerable size. C) rapid economic growth. D) low foreign debts. E) protectionism.
b
44) The first step in formulating and conducting research is: A) to define the problem. B) information requirement. C) choosing unit of analysis. D) examine data availability. E) research design.
b
45) The decision to enter one or more particular markets outside the home country depends on all of the mentioned factors except: A) company's resources. B) company's age. C) company's managerial mind-set. D) nature of opportunities. E) threats.
b
47) Upper-middle-income countries, also known as industrializing or developing countries are those with GNI per capita ranging from: A) $996 to $3,945. B) $4,036 to $12,475. C) $12,475 or higher. D) less than $995. E) None of the above
b
49) Coca-Cola achieved success in the Japanese market primarily by: A) standardization of marketing mix elements. B) global localization. C) vending machine operations. D) selecting market mix options. E) homogenization.
b
52) Prahalad and Hammond have identified several assumptions and misconceptions about the "bottom of the pyramid" (BOP) that need to be corrected. All of the following mistaken assumptions are correct except: A) The poor are too concerned with fulfilling basic needs to "waste" money on nonessential goods. B) The goods sold in developing markets are so expensive that there is no room for a new market entrant to make a profit. C) The poor have no money. D) People in BOP markets cannot use advanced technology. E) Global companies that target BOP markets will be criticized for exploiting the poor.
b
53) Global marketers should take note of the fact that almost half of the world's population is located in: A) low-income countries. B) lower-middle-income countries. C) upper-middle-income countries. D) high-income countries. E) higher-middle-income countries.
b
53) In many parts of the world, sales of unauthorized videos of Hollywood movies cost the movie studios billions of dollars. When illegal copies of movies are made, what form of intellectual property has been wrongly appropriated? A) patent B) copyright C) trademark D) trade secrets E) down loading
b
53) The "Common Market of the South" in Latin America is used to describe: A) SICA. B) Mercosur. C) Andean Community. D) CARICOM. E) FTAA.
b
54) Argentina provides a good example of how a country can emerge from an economic crisis as a stronger global competitor as per the following statement: A) Argentina reduced the duties on consumer goods. B) Argentina devalued its currency for exports and capital transactions. C) Argentina added tariffs on imported wines. D) Argentina adopted the U.S. dollar as official currency. E) Argentina added tariffs on wine produced within the country.
b
55) Harley-Davidson celebrates its 110th anniversary in 2013. The company has grown impressively during its century of operations. All of the following mentioned facts regarding the company are true except: A) the company's international success came after years of neglecting overseas markets. B) the company reacted swiftly to a growing threat from Japanese manufacturers. C) early on, the company used an export-selling approach. D) early on, it had an underdeveloped dealer network. E) after the 1980s, they recruited dealers in the important Japanese markets.
b
55) The power distance dimension reflects the degree of trust among members of society. Thus, the higher the power distance (PDI) the: A) greater is uncertainty avoidance. B) lower is the level of trust. C) higher is tolerance for ambiguity. D) greater is male dominance. E) lower is the harmony.
b
56) Danes generally are not afraid of taking chances; they are comfortable doing things that are not carefully thought out or planned. Denmark's "flexicurity" policy combines free labor markets with adjustable welfare benefits. This is an example of the application of Hofstede's typology under the values which highlight: A) Future Orientation. B) Uncertainty Avoidance. C) Gender Differentiation. D) Power Distance. E) Individualism/Collectivism.
b
56) Diageo PLC, V&S Vin & Spirit AB, and Seagram and other marketers know that Russians consume a great deal of vodka. This type of market segmentation can be classified as: A) demographic. B) behavioral. C) psychographic. D) occupational. E) benefit.
b
56) Examples of effective global marketing by McDonald's include both standardized and localized marketing mix elements. Which of the following does not represent a localized element? A) It serves McAloo tikki potato burger in India. B) It uses the advertising slogan "I'm lovin' it." C) It operates themed dining cars on the Swiss national rail system. D) It has home delivery service in India. E) It has slang nicknames such as MakDo in Philippines and McDo in France.
b
57) Research in Motion (RIM), a Canadian company which markets BlackBerry Messenger, is very popular with politicians and business people because it offers advance encryption that provides data security. This can be a disadvantage for some countries because: A) it is too complex to understand. B) governments use strict control for security reasons. C) the software can be easily downloaded. D) the accessibility is very poor. E) there is competition from local manufacturers.
b
58) In response to increasing worldwide concerns about obesity, diabetes, and other food-related health issues, some of the world's largest food companies are developing new products. Nestlé and Groupe Danone SA have developed several health-foods which include all of the following except: A) Souvenaid. B) Activa. C) NutriChoice. D) Nutraceuticals. E) Medical Foods.
b
59) Harley-Davidson has applied for federal protection of an unusual form of intellectual property; the "soul-pleasing rumble" produced by its motorcycles. What type of protection is Harley-Davidson seeking? A) copyright B) trademark C) license D) patent E) trade dress
b
60) Only Sony can use the "Walkman" name on its line of personal stereos. This is because: A) Sony has a patent on the Walkman. B) "Walkman" is a registered Sony trademark. C) Sony has copyrighted the Walkman name. D) Sony's trade secrets are protected by international law. E) Sony has an international business license.
b
60) The international marketing manager of an office furniture company ordered a research report on global telecommunications equipment sales. The report noted that, in the early 1990s, AT&T was awarded a $4 billion contract to provide communication network products and services in Saudi Arabia. The manager took this as a cue to put Saudi Arabia on her information agenda, reasoning that office furniture sales would increase as the country's telephone system was improved. As described here, the marketing manager is viewing Saudi Arabia as a(n): A) latent market. B) incipient market. C) cluster market. D) existing market. E) primary market.
b
60) Which of the following best sums up the experience of Walt Disney Company executives when creating Disney's theme park in Paris? A) They were guided by the "think global, act local" principle. B) They fell victim to the self-reference criterion. C) They exhibited a geocentric management orientation. D) They miscalculated the rate of diffusion of innovations in Europe. E) They had an unbiased perception of existing culture in Europe.
b
61) The Maastricht Treaty called for: A) the creation of an Asia Free Trade Area (AFTA). B) the creation of an economic and monetary union in Europe. C) Chile's acceptance into Mercosur. D) the purchase of CDs and tapes from distributors in Europe. E) the creation of the seven-nation European Free Trade Association (EFTA).
b
61) Which of the following is true about efforts by automakers to target the Hispanic segment in the United States? A) Honda, Toyota, Ford, and GM all began targeting the segment years ago. B) Honda and Toyota began targeting the segment years ago; Ford and GM launched their efforts more recently. C) Ford and GM began targeting the segment years ago; Honda and Toyota launched their efforts more recently. D) Only Ford and GM are targeting the Hispanic segment. E) none of the above
b
61) Which two companies are sourcing product components from small-scale enterprises, which in turn are helping preserve old-growth forests as well as economic opportunities in Brazil? A) Ford Motor Company and Armani B) Daimler AG and Hermes C) General Motors and Hugo Boss D) Volkswagen and Coach E) Coca-Cola and Nestlé
b
63) Which country was upgraded from "emerging" to "developed" status by the Financial Times Stock Exchange (FTSE) in 2009? A) United States B) South Korea C) Britain D) Italy E) Malaysia
b
64) Based on the total annual units sold in the worldwide market, the leading product category is: A) flat-panel TV sets. B) cigarettes. C) cell phone handsets. D) cars and light trucks. E) HDTV sets.
b
64) The new country joining the EU at the beginning of 2014 is: A) Slovakia. B) Estonia. C) Latvia. D) Slovenia. E) Cyprus.
b
66) As part of their alliance relationship, Northwest Airlines and KLM Royal Dutch set air fare prices jointly and coordinate flight schedules. Normally, such behavior would be considered harmful to competition, but the U.S. government has granted the two airlines special exemptions from laws concerning: A) intellectual property. B) antitrust. C) jurisdiction. D) licensing. E) arbitration.
b
66) That floppy disks are being dumped in favor of USB mass storage devices can be attributed to which characteristics of innovation? A) compatibility B) relative advantage C) divisibility D) communicability E) complexity
b
67) Which of the following is true about the Triad? A) Triad countries account for approximately one-third of world income and one- third of world population. B) Triad countries account for approximately 75% of world income as measured by GNP. C) Triad countries are those in which consumer products, industrial products, and the services sector each contribute one-third to GDP. D) Triad countries account for approximately 25% of world income as measured by GNP. E) Triad countries account for approximately 50% of world income as measured by the World Bank.
b
68) Unilever, the Anglo-Dutch consumer products company, at one time had 30 different package designs and 48 different formulations for its Rexona deodorant brand. This is an example of: A) ethnocentric orientation. B) polycentric orientation. C) regiocentric orientation. D) geocentric orientation. E) transnational orientation.
b
69) Marketing that involves creating the same marketing mix for a broad mass market of potential buyers is referred to as: A) differentiated target marketing. B) standardized global marketing. C) concentrated global marketing. D) competitive global marketing. E) target benefit marketing.
b
69) The "balance of payments" is a record of all economic transactions between the residents of a country and the rest of the world. It is divided into the current and capital accounts. Current accounts include all of the following except: A) balance on goods. B) portfolio investments. C) balance on services. D) goods imports. E) goods exports.
b
71) A few years ago, Philips Electronics developed a new consumer electronics product called the Digital Compact Cassette player. DCC did more than allow users to record and playback in a new digital format; DCC was also designed to play the older, analog cassette tapes that many people own. However, die-hard audio buffs were the only ones to buy DCC and Philips ultimately discontinued the product. Which of the following statements based on adopter categories describes this? A) early adopters bought, but innovators didn't B) innovators bought, but early adopters didn't C) innovators bought, and everyone else was a laggard D) early majority bought, but late majority didn't E) DCC was a laggard
b
72) Adopter categories are classifications of individuals within a market on the basis of their innovativeness. Recently Apple introduced the iPhone for which people waited in long lines before the doors opened. According to experts these 2.5% of people who bought the iPhone are categorized as: A) early adopters. B) innovators. C) early majority. D) late majority. E) laggards.
b
72) For years, ads for Volvo automobiles stressed safety features and protection in the event of a crash. Thus, Volvo automobiles developed a reputation based on which positioning strategy? A) use/user B) attribute/benefit C) competition D) high touch E) quality/price
b
73) When consumers have difficulty in verbalizing their perceptions, and there are different alternative brands of toothpaste, what is the best method of judging them in terms of similarity? A) cluster analysis B) MDS C) dependence techniques D) factor loading E) focus group
b
74) Comparing and contrasting the diffusion of innovations in Western countries and in Asia, one can say that: A) the process occurs in an identical manner in both regions. B) in Asia, the adoption process begins more slowly but ramps up more rapidly than it does in Western countries. C) in Western countries, the adoption process begins more slowly but ramps up more rapidly than it does in Asia. D) the diffusion of innovation framework is applicable in the West but not in Asia. E) the diffusion of innovation framework is applicable in Asia but not in the West.
b
74) In their book, Daniel Yergin and Joseph Stanislaw wrote "It is the greatest sale in the history of the world. Governments are getting out of businesses by disposing of what amounts to trillions of dollars of assets. Everything is going—from steel plants and phone companies . . . to hotels, restaurants, and nightclubs." This is an indication of: A) the fact that governments can make more money by selling assets. B) privatization is becoming a driving force for global marketing. C) these businesses are considered as closed markets. D) foreign companies are competing with governments. E) there is less demand for these type of companies.
b
77) In order to form a free trade area, South Africa has signed a Trade, Development, and Cooperation Agreement (TDCA) with: A) Swaziland. B) EU. C) Namibia. D) Angola. E) Japan.
b
77) The United States has more lawyers than any other country in the world and is arguably the most litigious nation on earth. This is a reflection of: A) the lack of class action lawsuits. B) the low-context nature of the American culture. C) the lack of spirit of confrontational competitiveness. D) the fact that lawyers cannot undertake cases on contingency fee basis. E) the fact that conflicts arise more in the United States.
b
77) Which of the following is true about "coffee culture" in England? A) Starbucks has been unsuccessful in its attempt to change the Brits' preference for tea. B) American entrepreneurs found success in England with the Seattle Coffee Company which Starbucks later acquired. C) Starbucks succeeded in England only after changing the company's name to Seattle Coffee Company. D) Starbucks-style coffee shops have been a flop because tea culture is too deeply engrained. E) Starbucks has been successful in England since it started selling beer.
b
78) If an American tourist in Tokyo pays more in dollars for the same amount of yen that she bought last week, then: A) a Japanese tourist in San Francisco pays more in yen for the same amount of dollars that she bought the week before. B) the dollar has depreciated relative to the yen. C) the yen has depreciated relative to the dollar. D) the dollar has appreciated relative to the yen. E) the dollar and yen both remained same in value.
b
78) Which of the following is true about etic and emic approaches to country analysis? A) The etic and emic approaches are identical. B) An emic approach studies a culture from within; etic analysis is "from the outside." C) An emic approach studies a culture "from the outside"; etic analysis studies a culture from within. D) The emic/etic distinction is not useful in cultural studies. E) The emic/etic approaches cannot be applied to Asian countries.
b
80) The strategy that identifies a brand as a symbol of a particular global segment is known as: A) foreign consumer culture positioning. B) global consumer culture positioning. C) local consumer culture positioning. D) global market positioning. E) demographic market positioning.
b
40) The only two countries where Coca-Cola is not available through authorized channels are: A) India and China. B) North Korea and South Korea. C) Cuba and North Korea. D) Cuba and Venezuela. E) Singapore and Indonesia.
c
63) The non-EU member which uses the euro as its currency is: A) Estonia. B) Kosovo. C) Montenegro. D) Vatican City. E) San Marino.
d
32) When identifying global market segments, a fundamental guiding principle should be the need to determine: A) shared demographic characteristics. B) similar languages. C) similar needs and buying behavior. D) similar ethnic backgrounds. E) similar geographic regions
c
33) Demographic segmentation is based on measurable characteristics of populations which includes all of the following examples except: A) Asia is home to 500 million consumers aged 16 and younger. B) India has more than half of the population younger than 25. C) Consumers buying Porsche would like to be noticed. D) The United States is home to 28.4 million foreign-born residents with combined income of $ 233 billion. E) In EU, the number of consumers aged 16 and under is rapidly approaching consumers aged 60.
c
33) The demise of communism as an economic and political system can be explained by all of the following facts except: A) communism is not an effective economic system. B) relatively superior performance of the world's market economies. C) communism works when the currency exchange rate is weak. D) difficult to manage national economies with a single central plan. E) increased public participation in matters of state.
c
34) An ________ is a company's private data network, accessible only by authorized persons inside the organization. A) EDI B) Internet C) intranet D) EPOS E) ECR
c
34) Bureaucracy is listed as a political risk category by: A) BERI (Business Environment Risk Intelligence). B) PRS Group. C) EIU (Economist Intelligence Unit). D) WTO (World Trade Organization). E) OPIC (Overseas Private Investment Corporation).
c
34) The use of this color dates back millennia as seen by artisans in ancient Egypt, China, and Mayan civilizations all worked with the color, which is now associated with royalty and divinity. A) Red B) Green C) Blue D) Orange E) Brown
c
34) Trade ministers representing the WTO member nations meet ________ to work on improving world trade. A) weekly B) monthly C) annually D) biannually E) fortnightly
c
35) A. Coskun Samli had developed a useful approach to global market segmentation that compares and contrasts "conventional" versus "unconventional" wisdom. An example of unconventional wisdom is: A) since per capita income in India is about $1,420, assuming that all Indians have low incomes. B) assuming that consumers in Europe and Latin America are interested in World Cup soccer whereas Americans are not. C) assuming that there is a presence of a higher-income middle-class segment in India. D) assuming that the potential Indian customer base for a McDonald's is larger than the size of entire developed countries. E) assuming that there is no running water and electricity in India.
c
35) Cultural influences are also quite apparent in food preparation and consumption patterns and habits. Domino's Pizza, the world's largest pizza-delivery company, pulled out of Italy because: A) tomato sauce was too bold and competed with Italian products. B) people did not like to eat at home. C) Italians perceived its products to be "too American." D) Italians wanted more toppings on thick crust. E) Italians did not like anyone else to use the name pizza.
c
35) The form of economic cooperation that calls for 1) eliminating internal barriers to trade and 2) establishing common external barriers is known as a(n): A) European Union. B) Economic union. C) Customs union. D) Free trade area. E) Common market.
c
36) One of the distinguishing features of a Centrally Planned Capitalism economic system is: A) all production resources are privately owned. B) the state has broad powers to serve the public interest as it sees fit. C) command resource allocation is utilized extensively in a private resource ownership environment. D) market allocation policies are permitted within an environment of state ownership. E) none of the above
c
36) While some food preferences remain deeply embedded in culture, there is plenty of evidence that global dietary preferences are converging. Examples of such a change can be predicted from: A) the popularity of Domino's Pizza in Italy. B) the preference for local hamburgers from a local chain, Jollibee's, in the Philippines. C) the growing number of McDonald's restaurants globally. D) the increased sales of soups and noodles in Thailand. E) popularity of Chinese foods in Taiwan.
c
36) ________ builds upon the elimination of internal tariff barriers, the establishment of common external barriers, and the free flow of factors. A) European Union B) Economic union C) Customs union D) Free trade area E) Common market
c
37) Based on 2011 projections, the top ten nations ranked by per capita income does not include: A) the United States. B) Japan. C) Russia. D) Spain. E) Italy.
c
37) CRM tools allow companies such as Credit Suisse, AT&T, Hewlett-Packard and others to determine: A) warranty of products sold to consumers. B) amount paid by consumers in different countries. C) which customers are most valuable. D) the use of credit cards for payment. E) the use of laptop computers by customers.
c
37) For decades, the economies of China, the former Soviet Union, and India functioned according to the tenets of: A) market capitalism. B) market socialism. C) centrally planned socialism. D) centrally planned capitalism. E) market capitalism and socialistic capitalism.
c
38) Ericsson, IKEA, Saab, and other companies based in Sweden have looked beyond their borders for significant growth market because: A) Sweden has high total annual income. B) Sweden has low total annual income. C) Sweden has a smaller population. D) Sweden is land locked geographically. E) Sweden has relaxed export policies.
c
38) The Swedish government has significant holdings in key business sectors and has a hybrid economic system that incorporates: A) market capitalism and centrally planned socialism. B) centrally planned socialism and market socialism. C) centrally planned socialism and capitalism. D) market socialism and market capitalism. E) market capitalism and socialistic capitalism.
c
38) The governmental action to dispossess a foreign company or investor is known as: A) compensation. B) confiscation. C) expropriation. D) internationalization. E) nationalization
c
39) Direct sensory perception provides a vital background for the information that comes from human and documentary sources since: A) it provides secondhand information. B) it is easy and the most economical way of collecting data. C) it means firsthand seeing, feeling, hearing, smelling, and tasting. D) it involves reading and reviewing documents. E) top executives are involved in getting firsthand information.
c
39) Located in The Hague, the International Court of Justice (ICJ) is the judicial arm of the: A) United States. B) European Union. C) United Nations. D) Netherlands. E) United Kingdom.
c
39) The Washington, D.C.-based Heritage Foundation survey consists of over 175 countries ranked by degree of economic freedom. The key economic variables considered for this ranking includes all of the following except: A) taxation policy. B) government consumption of economic output. C) percent foreign ownership. D) banking policy. E) wage and price control.
c
39) The concentration of income in the high-income and large-population countries means that a company can be "global" by targeting buyers in: A) just 50 countries. B) just 20 countries. C) just 10 or fewer countries. D) just 30 countries. E) none of the above
c
40) CRM tools allow companies such as Credit Suisse, AT&T, Hewlett-Packard and others to determine: A) warranty of products sold to consumers. B) amount paid by consumers in different countries. C) which customers are most valuable. D) the use of credit cards for payment. E) the use of laptop computers by customers.
c
40) Linguists have divided the study of languages into four main areas. The system of word formation is referred to as: A) syntax. B) phonology. C) morphology. D) semantics. E) semiotics.
c
41) The form of economic cooperation that calls for countries to eliminate all internal barriers to trade among themselves even while maintaining independent trade policies vis-à-vis third countries is known as a(n): A) Economic union. B) Customs union. C) Free trade area. D) Common market. E) None of the above
c
42) When the Coca-Cola Company was developing its new Dasani bottled water brand, linguists helped guide the naming process. For example, the recurring "a" was chosen because it has a soothing sound. In linguistics, issues pertaining to letters and sounds are a matter of: A) syntax. B) synonym. C) phonology. D) semiotics. E) semantics.
c
43) A vice-president of a shoe company was in India to assess the market. He found that many people in the southern part of India were walking bare footed. This can be indicative of either the fact that there is a potential market for shoes or there is no market for shoes in that part of the world. To formally confirm one instinct or the other the vice-president should: A) establish an office to start manufacturing shoes in India. B) give free shoe samples to a selected group of customers. C) conduct research to find the potential and actual customers. D) find out if that is true for other Asian countries. E) give up the idea of doing business in India.
c
43) The former chairman of Nestlé recently told an interviewer: "We are food and beverages. We are not running bicycle shops. Even in food we are not in all fields. There are certain areas we do not touch. Also, we have no soft drinks because I have said we either buy Coca-Cola or we leave it alone." What strategic marketing principle does the chairman's comment emphasize most specifically? A) customer value B) competitive advantage C) focus D) myopia E) policy of dealing only with Swiss businesses
c
44) Myanmar is considered as one of the emerging markets open for business. All of the following facts pertain to Myanmar except: A) Myanmar is a low-income country in Southeast Asia. B) Myanmar has a population of 65 million people. C) Myanmar is one of the countries considered as "Stans." D) Myanmar's citizens elected a president. E) Only one quarter of Myanmar's population has access to electricity.
c
44) Nike recently adopted the slogan "Here I am" for its pan-European clothing advertising targeting women. The decision to drop the famous "Just do it" tag line was based on the research indicating that: A) the famous slogan did not have accurate translation in European languages. B) Europeans do not like tag lines that portray American thinking. C) college-age women in Europe are not as competitive about sports as men are. D) the old slogan conveys superiority of men over women. E) European women want to differentiate themselves from men.
c
45) Giving business cards with the left hand in Malaysia, showing soles of shoes to a host in Saudi Arabia, and winking one eye in India are all considered impolite interpersonal communication due to the fact that: A) in Middle Eastern countries it is customary to take off shoes at the door. B) it is difficult to notice when one winks eyes since there are many people in India. C) people pick up nonverbal cues and understand intuitively without being told. D) these actions distract people from hearing at meetings. E) people are not aware of Western ways of doing business.
c
45) Psychographic segmentation involves grouping people in terms of their: A) combined household income. B) age and income. C) attitudes, values and lifestyle. D) psychological well being. E) gender.
c
45) The majority of the world's population is included in the following economic category: A) high-income countries. B) upper-middle-income countries. C) lower-middle-income countries. D) low-income countries. E) lower-upper-income countries.
c
45) When Mattel first introduced Barbie in Japan, managers assumed that Japanese girls would find the doll's design just as appealing as American girls did. This may be due to: A) Barbie's physical features such as long legs and blonde hair. B) Barbie being a symbol of American lifestyle. C) the SRC tendency on the part of American managers. D) the SRC tendency on the part of Japanese consumers. E) the limited competition for dolls in Japan.
c
46) A vice-president of an American software company introduced himself to a group of Korean partners and added "you may just call me John." Although this verbal cue shows the underlying reality that Americans have a high value on informality and equality, it needs adaptation due to the reason that: A) John is not a very popular name in Korea. B) it is difficult to translate John in Korean language. C) customs, hierarchies, and class structure of Korean culture have to be respected. D) Korean culture requires that first and last name be used in addressing guests. E) it is not appropriate to disclose nicknames in business meetings.
c
46) Porsche AG uses the label "Top Guns" to describe one segment of its customers, namely those who care about power and control and who expect to be noticed. Such a profile would be based on which type of segmentation? A) demographic B) occupational C) psychographic D) behavioral E) gender
c
46) With a 2011 GNI per capital of $1,410, India has transitioned out from the former category and now is classified as a(n): A) low-income country. B) upper-middle-income country. C) lower-middle-income country. D) upper-income country. E) lower-upper-income country.
c
47) A characteristic of a low-context culture which is prevalent in the United States, Switzerland, and Germany is that: A) less information is contained in verbal communication. B) major emphasis on a person's values and position in society. C) the messages are explicit and specific. D) a person's word is his or her bond. E) the negotiations are long and protracted.
c
47) Any Western country doing business in Malaysia or the Middle East should have an understanding of: A) the French Civil Code. B) Anglo-Saxon common law. C) Islamic law. D) the Uniform Commercial Code. E) Roman law and the Napoleonic Code.
c
47) SRI International developed Values and Lifestyles (VALS). Such a consumer profile would be helpful for which type of segmentation? A) demographic B) occupational C) psychographic D) behavioral E) gender
c
48) Two decades ago, professor Ted Levitt wrote a classic Harvard Business Review article titled "The Globalization of Markets." Which of the following statements about the author and the article is accurate? A) Levitt urged companies to adopt products on a country-by-country basis. B) There was universal agreement about his thesis that the world is becoming homogeneous. C) Levitt urged companies to develop standardized products that could be marketed worldwide with little adaptation. D) Levitt warned of the coming backlash against globalization. E) Levitt did not recommend developing standardized products.
c
49) In a study entitled "The Euroconsumer: Marketing Myth or Cultural Certainty?" the researchers identified different lifestyle groups. The segment that is concentrated in high-crime, inner-city neighborhoods were classified as: A) Successful Idealists. B) Affluent Materialists. C) Disaffected Survivors. D) Trendy Teens. E) Comfortable Belongers.
c
49) The Secretariat for Central American Integration is headquartered in: A) El Salvador. B) Honduras. C) Guatemala City. D) Nicaragua. E) Costa Rica.
c
50) A company that succeeds in global marketing: A) pursues a "one size fits all" strategy by creating identical products for homogeneous markets. B) customizes special products for each world country or region. C) creates both standardized and localized products. D) nurtures an ethnocentric management orientation. E) uses localized products only.
c
51) An important managerial task in global marketing is learning to recognize the extent to which it is possible to extend marketing plans as well as the extent to which adaptation is desired. The way a company addresses this task is a reflection of the company's: A) market penetration. B) market diversification. C) global marketing strategy. D) product development. E) product standardization.
c
51) Counterfeiting is: A) the use of a formal legal document for illegal purposes. B) the ownership of a written, recorded, performed or filmed creative work. C) the unauthorized copying or production of a product. D) the use of a product name that has different meaning than the original brand. E) the use of a distinctive mark of a brand that is no longer producing the original brand.
c
51) The DMBB agency created a psychographic profile of the Russian market. The categories include all of the following except: A) Kuptsy. B) Cossacks. C) Elites. D) Students. E) Business Executives
c
52) One of the dimensions of global marketing strategy which pertains to marketing management is: A) concentration of market penetration. B) coordination of market diversification. C) integration of competitive moves. D) coordination of product development. E) product standardization.
c
52) Potential markets can be subdivided into: A) latent and parallel markets. B) existing and incipient markets. C) latent and incipient markets. D) existing and latent markets. E) incipient and existing markets.
c
52) Two countries that score high in uncertainty avoidance are: A) Austria and Belgium. B) Japan and Hong Kong. C) Greece and Portugal. D) Denmark and Finland. E) Ireland and Italy.
c
53) Statements that illustrate the success of global marketing include all of the following except: A) the Coca-Cola Company supports its Coke brand by utilizing global and local marketing mix. B) Apple is synonymous with cutting-edge innovation and high-tech design. C) Italy's Benetton utilizes marketing as a knee-jerk reaction to world marketing needs. D) the backbone of Caterpillar's global success is its network of dealers. E) Germany's reputation for engineering and manufacturing provides a competitive advantage.
c
55) In accordance with GATT, new U.S. patents are granted for a period of ________ years from the filing date. A) 10 B) 17 C) 20 D) 27 E) 30
c
56) The original six members of the ASEAN (Association of Southeast Asian Nations) included all of the following countries except: A) Singapore. B) Thailand. C) India. D) Philippines. E) Brunei.
c
57) Several years ago, the DMBB agency created a single-country psychographic profile that includes segment labels such as "Cossacks" and "Kuptsy." What country does the survey cover? A) India B) Japan C) Russia D) China E) Vietnam
c
57) Which of the following nations fall in the lower-middle-income category? A) Burundi B) Bangladesh C) Egypt D) Venezuela E) none of the above
c
58) In 2005, representatives from several wine regions in the United States and the EU signed a Joint Declaration to Protect Wine Place & Origin. In addition, a Wine Accord signed by the United States and EU bans the: A) use of alcohol in public places. B) purchase of wine from country of origin. C) misuse of place names by marketers of wine products that do not originate in those places. D) misuse of labels which does not include the origin of ingredients. E) use of word "champagne" on wine made in the United States.
c
58) Measured by national income, the United States represents the world's largest single market for goods and services. Roughly what percentage of world income is found outside the United States? A) 25% B) 50% C) 75% D) 95% E) 35%
c
58) There are barriers in Japan for global marketers in terms of attitudes as well as laws. Barriers include all of the following except: A) any organization wishing to compete in Japan must be committed to providing top-quality products and services. B) repeat visits and extended socialization with distributors. C) goods marketed should have a semblance of western products and services. D) marketers must master the keiretsu system of tightly knit corporate alliances. E) trust has to be built before conducting successful business.
c
59) For the past 40 years Bhutan, a kingdom of 700,000 people in the Himalaya mountains, has relied on the following measure: A) GNI. B) GDP. C) GNH. D) GNP. E) GTE.
c
60) According to the Fortune global 500 companies for 2012, the largest corporation based on revenue is: A) Exxon Corporation. B) Toyota Motors. C) Royal Dutch Shell. D) General Electric. E) Walmart stores.
c
60) Three Mexican retailers Famso, Grupo Gigant SA, and Grupo Commercial Chedraui SA have opened stores in the United States. This is an indication of: A) U.S. retailers were lagging behind in collecting demographic information. B) the Mexican retailers provide better products than American stores. C) the Hispanic American segments represent a great opportunity for marketers. D) American businesses cannot compete with Mexican retailers. E) the Mexican retailers would like to compete with businesses like Best Buy and Circuit City.
c
60) Which of the following ASEAN countries ranks number one in terms of two-way trade with the United States? A) Brunei B) Malaysia C) Singapore D) Thailand E) Vietnam
c
61) Based on 2012 rankings of Fortune Global 500 companies, the world's most valuable car company is: A) GM. B) Daimler AG. C) Toyota. D) Ford. E) Chrysler.
c
61) In order to fight piracy in China, Budweiser Beer's approach includes: A) printing labels in Chinese. B) changing color of beer cans. C) beer cans in China have fluted edges. D) printing labels both in Chinese and English. E) making beer very cheap in price in China.
c
61) The lesson that SRC (Self-Reference Criterion) teaches can be summarized as: A) a person's perception of market needs is framed by others cultural experience. B) perceptual blockage and distortion about cultures are hard to reduce. C) unbiased perception is a vital and critical skill in global marketing. D) unconscious reference to one's cultural values is critical in global marketing. E) prior success and ethnocentrism can override the SRC.
c
62) Based on the size of the market in U.S. dollars, the leading consumer products are: A) cell phones. B) bottled water. C) cigarettes. D) video games. E) recorded music.
c
62) Product and market opportunities in a postindustrial society are more heavily dependent upon new products and innovations than in industrial societies. An example of this would be: A) Nestlé marketing Bono brand cookies in Brazil. B) Coca-Cola Company developing a beverage Vintago in low-income countries. C) New e-commerce markets for interactive forms of electronic communication. D) Hermes creating handbags called Amazonia. E) India's Suzlon Energy using wind-driven turbines.
c
62) When Walt Disney Company's executives were planning to build a theme park in France, they firmly believed that the success of McDonald's and Coke as well as their success in Tokyo Disneyland ensures the runaway success of their plans. Disney policies prohibit sale or consumption of alcohol inside the theme parks which they also implemented in France. This proved to be a failure since consuming wine with the midday meal is a long-established custom in France. This is most likely a classical example of: A) the "think global, act local" principle. B) being victim to the self-reference criterion. C) a geocentric management orientation. D) miscalculation of the rate of diffusion of innovations in Europe. E) an unbiased perception of existing culture in Europe.
c
64) The company receiving the most U.S. patents for the year 2009 is: A) Microsoft. B) Panasonic. C) IBM. D) Toshiba. E) Intel.
c
65) Which of the following can negatively influence the rate of diffusion of an innovation? A) substantial relative advantage B) high compatibility C) high complexity D) divisibility E) high level of communicability
c
66) The basis for global marketing expert David Arnold's framework for screening intercountry comparisons include: A) demographic data. B) "top-down" segmentation analysis. C) "bottom-up" segmentation analysis. D) income level. E) population data.
c
68) In the 1990s, Philips Electronics developed a new consumer electronics product called the Digital Compact Cassette player. DCC allowed users to record and playback in a new digital format; DCC was also designed to play the older, analog cassette tapes that many people own. This latter feature reflects which of the following characteristics of innovations? A) relative advantage B) communicability C) compatibility D) complexity E) divisibility
c
68) Manufacturers of Splenda, a low-calorie sugar, wanted to arrange a focus group to find out its use in different markets. Open-ended questions were used in order to secure the unconscious attitudes and biases held by the subjects. This type of technique is known as: A) scaling technique. B) qualitative technique. C) projective technique. D) reactivity technique. E) MDS technique.
c
68) The enlargement of the EU has impacted marketing strategies in the Eurozone countries by: A) making it difficult to export food products from one country to another. B) increasing the cost of production since the euro replaced local currency. C) shifting products from one market to another in the event of shortages. D) reduced tariffs and quotas for products imported from non-EU members. E) having less flexibility in the placement of factories.
c
69) Which of the following actions were approved both by the Antitrust Review in the EU as well as in the United States? A) acquisition of Honeywell (U.S.) by GE (U.S.) B) joint venture between music businesses of EMI group (Great Britain) and Time Warner (U.S.) C) merger of Sony Music (Japan) and BMG (Germany) D) merger of WorldCom (U.S.) and MCI (U.S.) E) British Airways (U.K.) and American Airlines (U.S.)
c
7) Which member of the Central American Integration System has both the largest economy and the largest population? A) El Salvador B) Honduras C) Guatemala D) Nicaragua E) Costa Rica
c
70) If a marketing manager plans to enter the newly industrializing countries (NICs) or other Asia markets with a product that has proved to be successful in the home market, the product's diffusion processes are likely to be: A) negligible since consumers will take time to assess the relative advantage. B) much slower than in the home market. C) much faster than in the home market. D) similar to that in the home market. E) less compatible in the Asian market.
c
70) The Swatch Group markets watches in all price ranges, from the Swatch brand at the low end to luxury brands such as Longines, Blancpain, and Breguet. Which target market strategy does this illustrate? A) standardized global marketing B) concentrated global marketing C) differentiated global marketing D) psychographic global marketing E) none of the above
c
70) With the global economic crisis as a backdrop, the first-ever Happiness Congress was held in: A) Sweden. B) Austria. C) Spain. D) Italy. E) Greece.
c
71) Political and social instability in the Middle Eastern region can primarily be attributed to: A) desert conditions and lack of agricultural land. B) cultural differences among nations. C) a wide gap between rich and poor nations due to oil revenues. D) lack of water purification facilities. E) the "Arab Spring."
c
71) Positioning refers to the act of: A) determining on what points on the globe to target. B) ensuring a choice retail shelf location. C) differentiating a brand in customer's mind. D) formulating a private label strategy. E) formulating a companion product.
c
71) Suppose Apple has collected extensive survey data about its new iPhone, and respondents have rated it on twenty different features and benefits. Now researchers want to reduce the amount of data to a few underlying dimensions. Which data analysis technique should the researchers use? A) analogy B) conjoint analysis C) factor analysis D) multidimensional scaling E) cluster analysis
c
72) Which of the following best describes the legal basis for protection of trade secrets, patents, and copyrights in the United States? A) Trade secrets, patents, and copyrights are protected by federal statutes. B) Trade secrets, patents, and copyrights are protected by state law. C) Trade secrets are protected by state law, while patents and copyrights are protected by federal statutes. D) Trade secrets are protected by federal statutes, while patents and copyrights are protected by state law. E) Trade secrets, patents, and copyrights are not protected by any laws.
c
73) Ads by BMW advertise it as the "ultimate driving machine" which is described as positioning based on: A) high touch. B) use/user. C) attribute/benefit. D) competition. E) quality/price.
c
73) Pfizer, Merck, Novartis, and other pharmaceutical companies have little choice but to engage in global marketing since: A) there is little demand for their products in home countries. B) their research centers are located overseas. C) no single market is large enough to recover costs incurred in research. D) there is more demand overseas for their products. E) technology is not available in home countries.
c
74) In spite of having about 45% of the world's known oil reserves, Saudi Arabia and other Middle Eastern countries post current-account deficits, largely because: A) of poor accounting practices. B) of vast economic diversification. C) they must import most of the goods and services. D) most of the oil is exported. E) new businesses are being developed.
c
75) A market researcher who uses multidimensional scaling (MDS) will: A) attempt to estimate market size by analogy. B) ask respondents to rate a particular product or brand in terms of multiple characteristics or attributes. C) ask respondents to evaluate product or brand pairs in terms of similarity. D) attempt to determine the combination of product features that create the greatest utility for consumers. E) conduct a focus group.
c
75) The Middle East and North Africa are sometimes viewed as a regional entity referred to as: A) GCC. B) AMU. C) MENA. D) ACC. E) ECOWAS.
c
75) The following criminal penalties may be imposed for violations of the FCPA'S (Foreign Corrupt Practices Act) antibribery provisions except: A) corporations are subject to a fine of up to $2,000,000. B) officers, directors, stockholders, employees, and agents are subject to a fine of up to $100,000. C) fines imposed on individuals can be paid by their employer or principal. D) the fines may be much higher, up to twice the benefit sought by the defendant. E) in addition to fines, there may be imprisonment for up to five years.
c
75) Which of the following is generally true about the marketing of high-touch products such as fine china and crystal? A) It relies equally on specialized information and image. B) It relies less on image and more on specialized information. C) It relies less on specialized information and more on image. D) Neither image nor specialized information is relevant to the marketing of high-touch products. E) It relies partially on specialized information and partially on image.
c
77) When a marketer understands that a product satisfies a buyer's rational criteria while also evoking an emotional response, the marketer should: A) only target consumers in high-income countries. B) utilize a multi-tiered targeting strategy rather than a concentrated strategy. C) commission psychographic segmentation studies to augment demographic data. D) create advertising that reflects a bipolar, high-tech and high-touch approach. E) follow normal targeting strategy.
c
78) Which of the following is true of advertising for the Heineken and Foster's brands in the United States? A) Both Heineken and Foster's utilize the GCCP strategy. B) Both Heineken and Foster's utilize the FCCP strategy. C) Heineken utilizes the GCCP strategy; Foster's utilizes the FCCP strategy. D) Heineken utilizes the FCCP strategy; Foster's utilizes the GCCP strategy. E) Heineken utilizes the LCCP strategy; Foster's utilizes the GCCP strategy.
c
79) Coca-Cola billboards were recently put up near the Piazza San Marco in Venice, which has numerous historical landmarks. The major reason for allowing the billboards at a prominent historical site is: A) Coke is a very popular drink in Italy. B) to introduce an American product in an emerging market. C) severe lack of funds for historic renovation. D) aesthetic. E) global marketing.
c
79) In the United States, some people believe that globalization has depressed the wages of American workers and resulted in the loss of both blue-collar and white-collar jobs. This is an example of: A) discrimination. B) domination. C) globaphobia. D) management myopia. E) economic crisis.
c
80) Whirlpool conducts usability studies that provide insight into the ways consumers interact with its products. In one study in an emerging market, engineers and designers stood behind a two-way mirror and watched as a volunteer put groceries away in a Kenmore Elite refrigerator. The Whirlpool team recorded a variety of data, such as the amount of time required for the volunteer to finish the task and the number of features used. The basis of this research study was based on the fact that: A) listening to customers is only possible in America. B) data collected in the United States should be applicable in other countries. C) consumers in different countries prefer different types of features. D) in China, it will be difficult to find enough space in homes to put a refrigerator. E) in India, refrigerators are seldom used by customers.
c
31) During the past two decades, the world economic environment has become increasingly dynamic. To achieve success, executives and marketers must take into account all of the following realities except: A) capital movements have replaced trade as the driving force of the world economy. B) production has become "uncoupled" from employment. C) the world economy dominates the scene. D) the struggle between capitalism and socialism continues. E) the growth of e-commerce diminishes the importance of national barriers.
d
33) There is nothing inherently "good" or "bad" about any color of the spectrum and all associations and perceptions regarding color arise from culture. Which of the following statements is not true? A) Red is a popular color in most parts of the world. B) Red color is associated with "active," "vibrant," and "emotional." C) Red color is preferred in many countries since it is the color of blood. D) Red color is highly preferred in some African countries. E) Red color is tied to the traditions of viticulture and winemaking.
d
33) Which form of regional cooperation agreement, when fully implemented, entails creation of a unified central bank, the use of a single currency, and common policies on agriculture, social services and welfare? A) Free trade area B) Customs union C) Common market D) Economic union E) Dispute settlement body
d
34) Starbucks has launched several new ventures in global markets, including music CDs and movie production. This is an example of: A) Market Penetration. B) Market Development. C) Market Diversification. D) Product Development. E) Global Marketing.
d
37) Arrange the following in order from lowest to highest level of economic integration. A) customs union→economic union→free trade area→common market B) economic union→customs union→common market→free trade area C) common market→free trade area→economic union→customs union D) free trade area→customs union→common market→economic union E) common market→economic union→customs union→free trade area
d
39) An intern from the United Kingdom was working in an American software company during summers. One day her boss gave her a memo asking her to post it, with the intention of having it put on the bulletin board. To her boss's surprise the letter was mailed by the intern since the word "post" means "mail" in British English. In communication terms this error can be attributed due to: A) syntax. B) phonology. C) morphology. D) semantics. E) semiotics.
d
40) Renault and its rivals are racing to offer middle-class consumers a new value proposition by selling cars for the equivalent of $10,000 or less. On the heels of Renault's success with Dacia Logan came the $2,500 Nano from India's Tata Motors. This illustrates that: A) consumers are looking for low price irrespective of quality. B) Renault is overcharging for their cars compared to their competitors. C) higher product development costs are a driving force behind globalization. D) market success depends on reaching a threshold of acceptable quality for consumers. E) cars are not very popular in emerging markets like India.
d
41) Walmart's exit from the German market was due, in part, to the fact that German shoppers could find lower prices at stores known as: A) All-in-one stores. B) Dollar stores. C) Discount sores. D) Hard discounters. E) Fresh & Easy stores.
d
42) McDonald's operates in over 118 countries; however, 80% of its restaurants are located in nine countries which does not include the following country market: A) Australia. B) Brazil. C) Germany. D) India. E) Japan.
d
42) The Uniform Commercial Code (UCC) is fully adopted by all U.S. states except: A) Virginia. B) North Dakota. C) Wisconsin. D) Louisiana. E) Montana.
d
43) Which of the following is not a common-law country? A) India B) Pakistan C) Malaysia D) Korea E) Singapore
d
44) The German civil-law tradition prevails in all of the following countries except: A) Poland. B) Hungary. C) Czech Republic. D) Scandinavia. E) Germany.
d
46) Islamic law is a comprehensive code based in part on: A) Anglo-Saxon common law. B) Roman law and the Napoleonic Code. C) the Uniform Commercial Code. D) the Koran. E) the French Civil Code
d
48) Implementation of the Central American Free Trade Agreement with the United States created a free trade area known as DR-CAFTA that includes all SICA members except: A) Honduras. B) Guatemala. C) Nicaragua. D) Panama. E) Costa Rica.
d
50) The law of disproportionality suggests that ________ percent of the company's menu or profits are accounted for the 20% of a firm's products or customers. A) 50 B) 60 C) 70 D) 80 E) 90
d
51) All of the following facts pertain to China except: A) China is in the upper-middle-income category. B) China is the largest single destination for foreign investment in the developing world. C) China is a member of the World Trade Organization. D) China has sprawling bureaucracy. E) China lacks infrastructure.
d
53) "Usage rates" and "user status" are important criteria for which segmentation variable? A) demographic B) occupational C) psychographic D) behavioral E) benefit
d
54) Campbell's Soup is making significant inroads into Japan's $500 million soup market as time-pressed homemakers place a premium on convenience. This type of consumer segmentation by Campbell's Soup is referred to as: A) demographic. B) occupational. C) psychographic. D) benefit. E) behavioral.
d
54) Which of the following would constitute a copyright violation? A) manufacturing and selling illegal videocassette copies of "Spiderman 2" B) manufacturing and selling illegal copies of Levi "501" jeans C) printing and selling illegal copies of Harry Potter books D) A, B, and C are copyright violations. E) A and B are copyright violations.
d
55) Nutraceuticals are health food products which are manufactured by: A) Kraft foods. B) General Mills C) Campbell's soups. D) Nestlé foods. E) Gerber foods.
d
56) Upper-middle-income countries that achieve the highest rates of economic growth are sometimes referred to collectively as: A) LDCs. B) BEMs. C) BRICs. D) NIEs. E) BOPs.
d
57) European consumers have faced a number of food-related issues, including an outbreak of hoof-and-mouth disease and continuing concerns over mad cow disease. As a result, many are skeptical about GMOs (genetically-modified organisms) and the benefits of eating food products that incorporate genetically-engineered ingredients. As one French citizen noted recently, "We have a very risk-averse society that has been completely traumatized by food scares." Thinking about this situation in terms of Hofstede's cultural values framework, one might reasonably interpret this remark to indicate that France ranks relatively high in: A) Power Distance. B) Short-term Orientation. C) Masculinity. D) Uncertainty Avoidance. E) Individualism.
d
58) Procter & Gamble's introduction of All-Temperature Cheer laundry detergent in Japan was a flop at first. The problem was that Japanese women wash clothes in cold water—either tap water or leftover bath water—so they don't care about all-temperature washing (which is a big selling point in the United States). Also, Cheer was first introduced in Japan at a time when the market for fabric softeners in Japan was rapidly expanding. However, when Japanese housewives added lots of fabric softener to the water, Cheer didn't produce many suds (Americans don't use as much fabric softener). P&G reformulated the product so it wouldn't be affected by fabric softeners, and ads for Cheer in Japan pledged superior cleaning in cold water, not all temperatures. Which of the following might have helped P&G avoid the initial problems with Cheer? A) Maslow's hierarchy B) high vs. low context culture C) diffusion of innovation D) self-reference criterion E) polycentric orientation
d
59) Even though Germany is the largest single-country market in Europe, what percent of the world market potential for German companies is outside Germany? A) 40% B) 55% C) 74% D) 94% E) 85%
d
59) The Walt Disney Company's decision to build a theme park in France provides an excellent vehicle to understanding SRC (Self-Reference Criterion). All of the statements listed below portray this meaning except: A) Disney executives believed there is virtually unlimited demand for American cultural exports. B) French are sensitive about American cultural imperialism. C) Consuming wine with the midday meal is a long-established custom which was not realized by Disney executives. D) Disney executives were blinded by their prior success and ethnocentrism. E) The SRC can be a powerful negative force in global business.
d
60) Pursuing alternative sources of energy, such as wind and solar power, is important due to the fact that: A) people in developing countries are more conscious about the environment. B) global marketers are more interested in publicizing environmental issues. C) it is easy to develop solar power in many parts of the world. D) heavy reliance on fossil fuels contributes to global warming. E) people worldwide can afford to buy power generated from wind and solar.
d
61) Predicting economic and income growth rates is particularly important when researching which type of market? A) existing markets B) latent markets C) parallel markets D) incipient markets E) local markets
d
63) Global automakers are targeting the U.S. market with SUVs. All of the following SUVs are assembled or manufactured in the listed country except: A) Porsche in Germany. B) Honda in Japan. C) Volkswagen in Slovakia. D) Kia in India. E) Mercedes-Benz in the United States.
d
63) Which of the following is true about protection of computer software? A) Copyright laws protect both the actual code and the idea embodied in the code. B) Patent laws protect both the actual code and the idea embodied in the code. C) Patent laws protect the actual code, while copyright laws protect the idea. D) Copyright laws protect the actual code, while patent laws protect the idea. E) License protects both the actual code and the idea embodied in the code.
d
64) Which of the following shows the correct order of the product adoption process? A) evaluation→trial→awareness→interest→adoption B) trial→interest→evaluation→awareness→adoption C) interest→awareness→adoption→trial→evaluation D) awareness→interest→evaluation→trial→adoption E) adoption→evaluation→trial→interest→awareness
d
65) Which of the following is true about revised U.S. patent laws? A) Patents are valid for 17 years after the patent is granted. B) Patents are valid for 17 years after the patent is filed. C) Patents are valid for 20 years after the patent is granted. D) Patents are valid for 20 years after the filing date of the application. E) Patents are valid as long as the product is manufactured.
d
67) The cell phone divisions of Toshiba, Sharp, and other Japanese companies prospered by focusing on the domestic market. When handset sales in Japan slowed a few years ago, the Japanese companies realized that Nokia, Motorola, and Samsung already dominated key world markets. Atsutoshi Nishida, president of Toshiba, noted, "We were thinking only about Japan. We really missed our chance." This example illustrates: A) geocentric orientation. B) regiocentric orientation. C) polycentric orientation. D) ethnocentric orientation. E) poor globalization orientation.
d
69) In Singapore, Coca-Cola wanted to develop an advertisement program. They selected a group of teenagers in a room, and a trained moderator facilitated discussion asking questions on brand's image, advertisement, social trends, TV watching habits, and snack usage. This type of research is called: A) survey research. B) observational studies. C) comparison studies. D) focus group research. E) experimental research.
d
71) The United States' growing trade deficit reflects a number of factors which exclude: A) increased imports from China. B) a seemingly insatiable consumer demand for imported goods. C) the enormous cost of military operations in the Middle East. D) the services trade surplus. E) record goods sales to developing countries.
d
73) Devaluation can result from government action or an economic crisis. In August 1998, the Russian economy imploded. As a result, all of the following listed events happened except: A) the ruble plunged in value. B) the government defaulted on its foreign debt obligation. C) many Russians faced wage cuts and layoffs. D) Russia's economy did not recover from the impact. E) savings were wiped out as banks collapsed
d
73) The U.S. Justice Department objected to a recent patent license agreement between S.C. Johnson & Sons and Bayer AG. The antitrust unit at the Justice department objected to: A) the duration of the license. B) the amount of royalties Johnson agreed to pay. C) Bayer's attempts to circumvent FDA policies. D) the exclusive nature of the license agreement. E) the hostile arrangement between Bayer and Johnson.
d
76) H.F. Iskander, general manager of Chevron's Kuwait office, stated "Chevron is pumping oil in different locations all over the world . . . there isn't a rock we haven't drilled through. We centralize all that knowledge at our headquarters, analyze it, sort it out, and that enables us to solve any oil-drilling problem anywhere." From the global marketing point of view this is an example of a global company: A) that is hungry to exploit natural resources. B) that is trying to be first to explore oil. C) that it is trying to solve world problems. D) that gains leverage through experience transfers. E) that does not have easy access to information.
d
76) In India, only about 10% of men who shave use Gillette razors. Worldwide, 50% of male shavers use Gillette products. To achieve greater penetration in India, Gillette rolled out a no-frills brand that costs 15 rupees—about 34 cents. The Gillette Guard has a lighter handle that is cheaper to produce. It also lacks the lubrication strip found in Gillette's more expensive razors, and replacement blades cost only 5 rupees (11 cents). This use of data and process are described as: A) demand pattern analysis. B) income elastic analysis. C) factor analysis. D) market estimation by analogy. E) multidimensional scaling.
d
76) The Big Mac Index shows that the price of the Big Mac in China converted from the local currency, yuan, to be $2.18, whereas its price in the United States is $3.73. This shows that: A) the Big Mac is more popular in China than in the United States. B) the Big Mac is less expensive in the United States than in China. C) the Chinese yuan is overvalued when compared to US $. D) the Chinese yuan is undervalued against the US $. E) beef is less expensive in China than in the United States.
d
76) When companies operate abroad in the absence of home-country legal constraints, the best choice for ethical conduct would be: A) to ignore bribery and act as if it does not exist. B) to maintain home-country ethics worldwide with no adaptations. C) to abandon any attempt to maintain company ethics. D) to have a product that is clearly superior to that of the competition. E) to adapt in varying degrees to local customs and practices.
d
77) One Friday a few years ago, the Big Mac Index suggested that the yen was overvalued relative to the dollar by 70%. When currency markets opened on the following Monday, anyone using the Big Mac Index would conclude that the yen was only 20% overvalued relative to the dollar. What is the most likely explanation for this? A) Japan's Central Bank acted to prop up the yen. B) Inflation in Japan suddenly spiked upward. C) McDonald's headquarters stopped hedging. D) McDonald's Japan reduced the yen price of a Big Mac. E) McDonald's Japan increased the yen price of a Big Mac.
d
79) A market research study of soft drink consumption and distribution in Hungary commissioned by an American company indicated that soft drinks were available in drugstores. However, Western-style drugstores do not exist in Hungary. This illustrates an important issue in global marketing research, namely: A) inflated data. B) using convenience samples. C) market estimation by analogy. D) comparability of data. E) using multiple dimensional scaling.
d
79) Other than tariffs, there are certain problems that restrict free trade between the European Union and the United States which includes all of the following except: A) use of genetically modified agricultural products. B) product labeling. C) Hollywood movie domination. D) Internet usage. E) cultural diversity.
d
80) McDonald's restaurants are found in more than 118 countries. To ensure high levels of consistency and quality, the company's far-flung restaurant system incorporates many standardized elements (e.g. restaurant design, burgers/fries/soft drinks as basic menu offerings). However, McDonald's also prides itself on sourcing many of its food inputs (e.g. potatoes and dairy products) in individual host countries. McDonald's strives to be locally responsive—it creates new menu items specifically designed with local eating customs and preferences in mind. Typically, McDonald's forms joint ventures with local partners, a tactic that ensures that a local "face" is associated with the company. Finally, McDonald's has been in many country markets long enough that a new generation of consumers has grown up with McDonald's and are not aware of the company's U.S. origins. On the basis of this summary, what is the highest stage of corporate development that McDonald's arguably has achieved? A) international B) multinational C) global D) transnational E) myopic
d
31) Before an agreement can be reached between the United States and European Union, major differences will have to be worked out. These differences include aspects related to all of the following except: A) agriculture. B) genetically modified crops. C) tariff reduction. D) cross-border investment. E) job creation.
e
31) Japan is Coach's second largest market, representing about 20% of global sales. All of the following statements are true regarding the market for Coach's products compared to that in America except: A) Japanese consumers are enormously brand-centric. B) Japanese consumers are not as brand loyal as American consumers. C) American women tend to carry two or three brands while their Japanese counterparts tend to carry as many as five. D) The company's $500 handbags are especially popular with young women. E) Coach has to work on improving its brand image in Japan.
e
31) The efforts of global companies to reach low-income consumers in emerging markets highlight the importance of skillful global market segmentation and targeting. Market segmentation represents: A) targeting prospective customers. B) finding customers who can respond to advertisement. C) promoting products and services internationally. D) identifying customers who can help in promoting products. E) an effort to identify and categorize customers based on common characteristics.
e
34) Traditionally economists identified main types of economic systems, which include all of the following except: A) market capitalism. B) market socialism. C) centrally planned socialism. D) centrally planned capitalism. E) centrally planned nationalism.
e
35) Various types of political risk insurance to U.S. companies is provided by: A) BERI (Business Environment Risk Intelligence). B) PRS Group. C) EIU (Economist Intelligence Unit). D) WTO (World Trade Organization). E) OPIC (Overseas Private Investment Corporation).
e
41) Although environmental scanning is a vital source of information, research has shown that headquarters executives of global companies obtain as much as two-thirds of the information they need from: A) government publications. B) professional publications. C) trade publications. D) census data. E) personal sources.
e
41) In 2011, the ten most populous countries in the world accounted for just over ________ percent of the world income. A) ten B) twenty C) thirty D) forty E) fifty
e
41) Singapore banned the import, manufacture, and sales of chewing gum in the country since wads of gum were making a mess on sidewalks, buses, and subway trains. Violators are subject to severe penalties, and before buying a pack consumers must register their names and addresses. This, according to author William Greider, demonstrates that Singapore's government: A) is harshly autocratic. B) administers a paranoid control over Singaporeans. C) administers a paranoid control over press and politics. D) runs an effective welfare state. E) all of the above
e
41) What happens if a nation has allowed a case against it to be brought before the ICJ (International Court of Justice) and then refuses to accept a judgment against it? A) American Arbitration Association can be sought for justice. B) UN Conference on International Trade Law can be approached. C) International Chamber of Commerce will be another source for seeking justice. D) European Court of Justice can be approached if the country is in the European Union. E) The plaintiff nation can seek recourse through the UN Security Council.
e
42) Venezuelan President Hugo Chavez believed in all of the following aspects except: A) nationalization of international companies. B) imposition of currency controls. C) free-market economic policies. D) capitalism is a structural crisis. E) energy pact known as Petrocribe.
e
19) A European company that focuses its attention on Europe can be considered to have geocentric orientation.
false
42) Which of the following environmental factors may require marketers to adjust their approach to conducting international as opposed to domestic marketing research? A) Researchers must be prepared for new parameters of doing business. B) Company personnel must come to grips with a new set of culture-based assumptions about conducting business. C) Research may help reduce psychological overload. D) Researchers may have to broaden the definition of competitors to include competitive pressures not present in the domestic market. E) all of the above
e
46) The five original members of the Central American Integration System did not include: A) El Salvador. B) Honduras. C) Guatemala. D) Nicaragua. E) Venezuela.
e
47) Anyone undertaking a market research project should understand that the first step is: A) setting the budget. B) determining the methodology to use. C) deciding who will see the final report. D) defining the problem. E) determining the information requirement.
e
48) Among the upper-middle-income countries, also known as industrializing or developing countries, the following aspects are observed except: A) the CNI per capita ranges from $4,036 to $12,475. B) the percentage of the population engaged in agriculture drops sharply. C) people move to the industrial sector. D) the degree of urbanization increases. E) None of the above
e
48) For consumer products, qualitative research is especially well suited to: A) get close to the consumer. B) describe the cultural context of consumer behavior. C) identify core brand equity. D) identify what people really feel. E) all of the above
e
48) In the study entitled "The Euroconsumer: Marketing Myth or Cultural Certainty?" the researchers identified four lifestyle groups. The group that represents mainstream European consumers was labeled as: A) Successful Idealists. B) Affluent Materialists. C) Young Professionals. D) Trendy Teens. E) Disaffected Survivors.
e
49) The general characteristics shared by low-income countries do not include: A) high birth rates. B) low literacy rates. C) concentration in Africa south of the Sahara. D) heavy reliance on foreign aid. E) lack of genuine market opportunities.
e
52) The unauthorized publication or reproduction of copyrighted work is referred to as: A) associative counterfeit. B) imitation. C) mistake. D) trade secrets. E) piracy.
e
54) The United Nations designates 50 countries in the bottom ranks of the low-income category named as: A) Low-income countries. B) Lower-middle-income countries. C) BRIC countries. D) Developing countries. E) LDCs (least-developed countries).
e
56) Which of the following correctly reflects marketing expert David Arnold's recommendations for companies engaged in global market research? A) use multiple indicators B) develop customized measures specific to an industry or product C) conduct comparative assessments in neighboring countries D) observation should be weighted more heavily than statements of purchase intention E) all of the above
e
59) According to the authors of the Harvard Business Review article, "Serving the World's Poor, Profitably", which of the following is a mistaken assumption that global companies might have about the BOP (bottom of the pyramid)? A) The poor have no money. B) The poor are too concerned with fulfilling basic needs to "waste" money on nonessential goods. C) People in BOP markets will be criticized for exploiting the poor. D) People in BOP markets cannot use advanced technology. E) All of the above are mistaken assumptions discussed by the authors.
e
62) Which of the following criteria should marketers use when assessing opportunity in global target markets? A) current size of the segment B) anticipated growth potential C) competition D) compatibility with company's overall objectives E) all of the above
e
63) One of the basic elements of sociologist Everett Roger's Diffusion theory is the concept of an "adoption process." The first step in this adoption process is: A) interest. B) evaluation. C) trial. D) adoption. E) awareness.
e
64) Managers must decide how well a company's product fits the country market by asking the following questions except: A) Will adaptation be required? B) Will import restriction drive up the product price? C) Is it advisable to source locally? D) Will strong home currency have an adverse impact on product price? E) Will it be possible to neglect home-country regulations?
e
64) The Organization for Economic Cooperation and Development (OECD) is comprised of: A) the 34 high-income countries. B) countries that believe in market-allocation economic systems. C) pluralistic democracies. D) countries that demonstrate progress toward economic reform. E) All of the above statements are applicable.
e
65) Emerging markets present a number of challenges to anyone conducting market research, which includes all of the following except: A) underdeveloped technology infrastructure. B) geographic issues. C) data-gathering methodologies. D) privacy issues. E) lack of field teams.
e
65) Markets of Central and Eastern Europe present interesting opportunities and challenges. Companies such as 3M International, McDonald's, Philips Electronics, and Henkel are moving into the region for all of the following reasons except: A) the region is an important new source of growth. B) that the first company to penetrate a country market often emerges as leader. C) wage rates are much lower than those in Spain, Portugal, and Greece. D) the region offers attractive locations for low-cost manufacturing. E) core products and Western brand names need changes to meet consumer demands.
e
65) The feasibility of targeting a particular market segment can be negatively impacted by various factors which does not include: A) regulatory hurdles. B) cultural barriers. C) lack of distribution system. D) time required to establish business. E) surplus demand.
e
65) The term "Expanded Triad" includes all of the following countries or regions except: A) Japan. B) United States. C) Canada. D) Mexico. E) Russia.
e
66) A marketer of breakfast cereals might send researchers to preselected households at 6 A.M. to watch families go about their morning routines. The client could also assign a researcher to accompany family members to the grocery store to record their behavior under actual shopping conditions. This type of research method is considered as: A) focus group. B) invasion of privacy. C) consumer panel study. D) factor analysis. E) observation.
e
66) Management strategic options pertaining to products that are facilitated by a single European market include: A) standardized packaging and labeling. B) consolidated production. C) shift from brand to benefit segmentation. D) seeking marketing economies. E) all of the above
e
66) Recently, the Organization for Economic Cooperation and Development (OECD) has become more focused on global issues, social policy, and labor market regulations as seen by: A) addressing the vexing problem of bribery. B) requiring members to cooperate when pursuing bribery allegations. C) helping members candidly assess their own economic policies. D) member nations working together in committees to review social policies. E) all of the above
e
67) Basic criteria that marketers should keep in mind while assessing opportunities in global markets include all of the following except: A) current size of the market segment. B) anticipated growth potential of the market. C) compatibility with company's overall objectives. D) competition in the market. E) securing first mover advantage.
e
67) Because they are in transition, the markets of Central and Eastern Europe present interesting opportunities and challenges which include: A) new source of growth. B) first mover advantage. C) exporting as an entry mode. D) lower wage rate. E) all of the above
e
67) The European Commission has jurisdiction over European-based companies as well as non-European ones that generate significant revenues in Europe. If Microsoft applies in Europe, the Commission has a right to all of the following except: A) it can block a proposed merger. B) it can block a proposed joint venture. C) it can approve with minor modifications. D) it can demand substantial concessions before granting approval. E) it can refer serious matters to the UN Security Council.
e
68) Companies like Coca-Cola had the first-mover advantage since they were the first company to enter a global market. However, there are also first-mover disadvantages which include: A) best chance of becoming world leader. B) advantage in adapting to the local culture. C) lead in advertising and promotion exposure. D) gain business experience. E) substantial investments in marketing.
e
68) Which of the following statements is not accurate? A) India's teledensity—a measure of ownership of private telephones—is only 20% of population. B) In China, saturation levels of private motor vehicles and personal computers (PCs) are quite low. C) In 2001, EU had 49 cars per 100 people. D) In Russia, 200 people out of 1,000 own cars. E) In India, 150 people out of 1,000 own cars.
e
69) Transnational companies, such as Toyota and Honda, have characteristic features that include: A) being in both global markets and utilizing global supply chains. B) characterized by a mind-set of being "stateless." C) using both localized and standardized elements in marketing programs. D) decisions made on the basis of ongoing research. E) all of the above
e
70) Consten, a French company, had exclusive rights to import and distribute German Grundig's electronic products into France. One of the competitors started bringing "parallel imports" into France illegally, importing Grundig product bought from a foreign supplier. Which of the following does not represent an action taken by different legal bodies? A) Consten's complaint was upheld by two French courts. B) The Paris Court of Appeals suspended the judgment of the French courts. C) The Paris Court of Appeal's judgment was based on pending a ruling by the European Commission. D) The European Commission ruled against Consten on the grounds that territorial protection proved to be damaging to the Common Market. E) The European Commission ruled that German Grundig was in violation of the laws of the Common Market.
e
70) Nestlé, Unilever, GlaxoSmithKline, and Royal Philips Electronics can be considered transnational companies on the basis of: A) sales outside the home country to total sales. B) assets outside the home country to total assets. C) employees outside the home country to total employees. D) headquartered in a relatively small home-country market. E) all of the above
e
72) One study of adult involvement in household tasks revealed greater similarities between the United Kingdom and the United States compared with France, Belgium, and French Canada. Thus, the United States and United Kingdom were "twins" based on common language. This study is an example of: A) market latency. B) conjoint analysis. C) factor analysis. D) multidimensional scaling. E) cluster analysis.
e
72) The fastest-growing sector of world trade includes: A) travel and entertainment. B) accounting and legal services. C) royalties and license fees. D) engineering services. E) all of the above
e
73) Which of the following is true about the innovation diffusion process in Asia? A) Japan has a high-context culture with a relatively homogeneous population. B) Because risk avoidance is a cultural value, there are fewer innovators in Asia than in the United States. C) Once innovators in Asia have tried a product, early adopters and the early majority quickly follow suit. D) After a new product has achieved success in one Asian market, it is likely to be adopted in other Asian markets at an even faster rate. E) All of the above are true.
e
74) According to the Transparency International's Corruption Perceptions Index scores for 2010, the country which was listed as most corrupt was: A) Iraq. B) Uzbekistan. C) Chad. D) Afghanistan. E) Somalia.
e
74) Campbell is the world's largest soup company, commanding about 80% of the U.S. canned soup market. However, the company has a presence in only 6% of the world's soup markets. Russians eat 32 billion servings of soup each year, and the Chinese consume 300 billion! By contrast, Americans eat 15 billion servings each year. Sensing a huge opportunity, Campbell has dispatched teams to observe Russian and Chines habits. This type of interpretation and decision is based on: A) demand pattern analysis. B) income elastic analysis. C) time series displacement. D) polycentrism. E) comparative analysis.
e
77) According to David Arnold, there are four possible approaches to forecasting by analogy, which does not include which of the following? A) Data is available on a comparable product in the same country. B) Data is available on the same product in a comparable country. C) Data is available on the same product from a dependent distributor in a neighboring country. D) Data is available about a comparable company in the same country. E) Data is available on the same product in every country.
e
77) Japan's giant Matsushita Electric Company achieved scale economies by exporting VCRs, televisions, and other consumer electronics products throughout the world from world-scale factories in Japan. This is an example of the fact that: A) scale economies were a cornerstone of Japanese success in the 1970s and 1980s. B) leverage from scale economies is not limited to manufacturing. C) a global company can achieve the same economies on a global scale. D) the larger scale of the global company also creates opportunities to improve corporate staff competence and quality. E) all of the above
e
78) Despite the fact that the American team advanced to the semi-finals in South Africa, the game is much more popular in other parts of the world. There is an effort to make soccer popular in the United States, and many fashion brands are interesting in marketing their products which pertain to soccer and other sports. Considering this aspect which of the following statements is incorrect? A) In the United States, 2010 World Cup merchandise such as T-shirts was available at Walmart. B) FIFA is the only global marketer seeking revenue growth by boosting soccer's popularity in America. C) Yves Saint Laurent designer was selling merchandise with soccer related embossed emblems. D) The fall 2010 collection of designer clothes included "FIFA Heritage Tees" with logos on shirts. E) FIFA has chosen Total Apparel Group (TAG) to boost soccer's visibility and popularity among Americans.
e
78) Which of the following is true of the arbitration framework created by the New York Convention? A) Signatory countries can require parties to an arbitration agreement to actually use arbitration. B) Signatory countries recognize and can enforce arbitration judgments. C) There are limited grounds for appealing arbitration decisions. D) The grounds that are recognized are different than the typical appeals that are permitted in a court of law. E) all of the above
e
79) Porsche relies on currency hedging rather than price increases in order to: A) boost pretax profits on sales of its automobiles. B) balance the relative value of the dollar compared to the euro. C) protect all earnings from foreign-exchange movements. D) generate about 45% of its sales in the United States. E) A, B, and C
e
2) An intranet is a public network that allows authorized company personnel or outsiders to share information electronically in a secure fashion.
false
22) "Back translation" is a technique used to ensure that currency conversion is performed correctly when financial statements of foreign subsidiaries are consolidated with financial statements at headquarters.
false
11) In order to convey the sense of the country of origin it is advisable to use the same background music in broadcast commercials in all parts of the world.
false
17) Unilever's Rexona deodorant brand had 30 different package designs and 48 different formulations. This is an example of ethnocentrism.
false
20) A market segment or country market characterized by weak competition may be a segment to avoid.
false
25) Standardized global marketing is analogous to mass marketing in a single country and is also known as differentiated target marketing.
false
27) The foreign exchange market consists literally of a buyer's and a seller's market where currencies are traded for both spot and future delivery on a continuous basis. The forward market is for immediate delivery and the spot market is for future delivery.
false
28) In global marketing research, the results of a nonprobability sample can be projected with statistical reliability.
false
6) Now that Latvia has joined the Euro zone it is expected that higher interest rates will promote further economic growth.
false
6) The ultimate goal of a free trade agreement is to have standardized duties on goods that cross borders between the partners.
false
11) India, Pakistan, Malaysia, Korea, and Japan have common-law jurisdictions.
false
11) McDonald's global marketing strategy is based primarily on local marketing mix elements.
false
12) "Sharia" and "haram" are important concepts in civil-code laws, which are commonly practiced in Middle Eastern countries.
false
12) Categories such as "successful idealists" and "affluent materialists" can be used to describe age segmentation.
false
12) Companies wishing to minimize the cost and effort associated with market research should start by collecting and analyzing primary data.
false
14) About 25% of the world population is included into the low-income economic countries category as per the World Bank classification system.
false
14) For behavior segmentation, marketers use the 80/20 rule when assessing the consumers' usage rate, which means that 20% of the company's revenues or profits are accounted for by 80% of the firm's products or customers.
false
15) To establish ownership of a written, recorded, performed, or filmed creative work, it is necessary to apply for and be granted a patent.
false
16) America's Hispanic population shares a common language, and so in ethnic segmentation they can be grouped as one segment.
false
16) The term "polycentric" describes management's belief or assumption that each country in which a company does business is the same as the home country business.
false
16) Traditional market research is the most effective means for identifying latent markets.
false
17) When assessing potential country target markets, management should rely heavily on its network of contacts as a primary criterion for targeting.
false
18) Antitrust laws in the United States and other countries are designed to combat restrictive business practices and to discourage competition.
false
18) India is the world's fastest growing cell phone market with the industry expanding at a rate of 50% annually with 5 million new subscribers added every month. This is an indication of continued private-sector growth.
false
18) With a 2011 GNI per capita of $1,410, India has transitioned out of the low-income category and is now classified as an upper-middle-income country, also known as an industrializing or developing country.
false
22) The president of an American company was interested in dealing with a company in Saudi Arabia. The Saudi CEO made it clear at the outset that the credentials in the documents have less credibility than personal trust and confidence. This shows that the Saudi Arabian culture is a high-context culture.
false
22) When making a decision about market entry timing, a company's management team should understand that the first-mover always becomes the market leader.
false
23) "Back translation" is a technique whereby a survey or other document that has been translated is returned (i.e. "sent back") to the translator for corrections.
false
24) In the context of global marketing, leverage means some type of advantage that a company enjoys by virtue of the fact that it has experience in its home country.
false
24) The "balance of payments" is a record of all economic transactions between the residents of a country and the developed countries of the world.
false
25) A country with a positive current account balance has a trade deficit; that is, the outflow of money to pay for imports exceeds the inflow of money for sales of exports.
false
25) According to Hofstede's research on cultural values, masculinity dimension describes a society in which social roles of men and women overlap.
false
25) Denmark ranks highest in bribery as listed by the Corruption Perceptions Index (CPI) by Transparency International in 2010.
false
26) If an American businessperson pays a Russian customs agent a $20 cash "processing fee" to avoid delay in leaving Russia, the businessperson has violated the Foreign Corrupt Practices Act (FCPA).
false
26) When using a "projective technique," the researcher presents close-ended or ambiguous stimuli to a subject in a focus group.
false
27) The power distance dimension reflects the degree of trust among members of society. Thus, the higher the power distance (PDI), the higher the level of trust.
false
28) IKEA, the home furnishings retailer based in Sweden, wraps itself in the Swedish flag-literally, since inside and out, their stores are decorated in the national colors of blue and yellow. This is an example of local consumer culture positioning.
false
28) Nontariff barriers (NTBs) are monetary restrictions on cross-border trade.
false
29) A country's currency would be overvalued if the Big Mac price (converted to dollars) is lower than the U.S. price.
false
29) If interaction between two variables is desired, factor analysis can be used to transform large amounts of data into manageable units.
false
3) Culture includes conscious and unconscious values, ideas, attitudes, and symbols that shape human behavior and that are confined to one generation.
false
4) Companies can increase prices if costs are low because of process efficiencies in manufacturing.
false
4) Dove, a division of Unilever, traditionally targeted men and women with its Dove-branded skin care products.
false
4) It is mandatory for countries to notify the WTO when they enter into preferential trade agreements.
false
4) When many nations reach advanced stages of economic development, their governments declare that any practice or policy that restrains free trade is legal.
false
7) In centrally planned socialism economic systems, the state allocates resources, whereas production resources are privately owned.
false
7) The high level of political risk currently evident in Russia can be attributed in part to excessively low taxes on business operations.
false
8) If a foreign company is taken over by the host country government, and some form of compensation is paid, "confiscation" has occurred.
false
8) In Sweden, where the government controls two-thirds of all expenditures, resource allocation is more "market" oriented than "command" oriented.
false
8) In surveys about color preferences, 50 percent of respondents indicate green is their favorite—and it is favored by a wide margin over the next-preferred color.
false
19) Mercosur or the Common Market of the South resulted from a treaty signed by four countries: Argentina, Brazil, Paraguay, and Venezuela.
false - uraguay not venezuela
18) Red Bull energy drink manufacturer, Dietrich Mateschitz, hired a market research firm to assess the market potential for the drink. In the tests, consumers reacted negatively to the taste, the logo, and the brand name. The company ignored the research completely.
true
11) Cuba and North Korea are the only two countries where Coca-Cola is not available through authorized channels.
true
16) In China, Dell had to find a meaningful interpretation of "direct sales," the phrase that describes the company's powerful business model.
true
17) About one-fourth of the cut roses sold in the United States come from Ecuador.
true
21) Americans typically want to "go it alone." As a result, they may be outnumbered in a negotiation situation.
true
27) A global company can leverage its experience in any market in the world.
true
1) President Franklin Roosevelt launched the Works Progress Administration (WPA) which put millions of Americans back to work.
true
1) Venice is unique among the cities of the world and consists of more than 100 islands linked by a system of canals.
true
10) A "civil-law country" is one in which the legal system reflects the structural concepts and principles of the Roman Empire in the sixth century.
true
10) In addition to eliminating internal barriers to trade, members of a customs union agree to the establishment of common external tariffs.
true
10) In an effort to "Americanize" the sound of the Beatles' recordings, a studio effect known as reverb was added to some tracks.
true
11) The vast majority of India's population comprises a "bullock cart" segment whose households lack most comforts but typically owns a television.
true
13) Tang drink powder became a $1 billion brand as regional managers in the Middle East added mango and pineapple flavors.
true
13) The World Bank has developed a four-category classification system for stages of marketing development which uses per capita gross national income (GNI) as a base.
true
15) A number of authors, journalists, and food critics have chronicled a disturbing trend in the land of haute cuisine-the decline in France's status as a culinary superpower.
true
15) Although Bangladesh is categorized in the low-income countries, they have genuine market opportunities, particularly in the garment industry.
true
15) Ethnocentric companies that conduct business outside the home country adhere to the notion that the products that succeed in the home country will succeed anywhere.
true
15) Implementation of the Central American Free Trade Agreement with the United States created a free trade area known as DR-CAFTA.
true
15) Pareto's Law suggests that 80% of a company's revenues or profits are accounted for by 20% of a firm's products or customers.
true
16) A patent holder retains all rights for the life of the patent even if the product is not produced or sold.
true
17) Culture shapes attitudes and values in a way that directly affects people's willingness to respond to interviewer questions.
true
17) In Korea 4 5683 968 can be interpreted as "I love you."
true
18) A U.S. company that focuses on the countries included in the North American Free Trade Agreement (NAFTA) has a regiocentric orientation.
true
18) Colgate discovered that in Spanish colgate is a verb form that means "go hang yourself."
true
19) An "incipient market" is a market that will emerge if a particular economic, demographic, political, or sociocultural trend continues in a country.
true