Strategic Management Chapter 10
True or False: U.S. MNEs have disproportianlately positive impact on the U.S. economy
True
Since expanding internationally, IKEA has shifted focus, conventrating on effectivelymanaging a global supply chain in order to acheive economies of scale. This is reflective of a ____________.
global-standardization
IKEA offers the same products in every market. This indicates that IKEA has followed a __________ strategy.
international
Foreign direct investments are investments in __________
value chain activities abroad
Which of the following statistics regarding MNEs are correct?
-They pay 25% of the wages in the united states -they make up 74% of the private sector R&D spending since 2000 -They account for 11% of the private sector emplyment growth since 1990.
As MNEs compete internationally, a focus on local responsiveness allows them to do which of the following?
-increase product differentiation -appeal to local consumers more effectively
Which of the following are disadvantages of the multidomestic strategy?
-it is inefficeint -it is costly
Which of the following are disavantages of the multidomestic strategy?
-it is inefficient -it is costly
Which of the following risks do companies face when expanding internationally?
-loss of intellectual property -loss of reputation -the liability of foreignness
Which of the following factors help define adminsistrative and political distance?
-the strength of finacial insitutions -politcal hostilities -shared monetray associations
Which of the following helped motivate globalization after the end of World War II
-unfilled needs during the war -the need to reconstuct economies damaged by war
Which of the following statements about economic distance are true?
-wealthy companies benefit from trade when their competitive advantage is based on economies of experience, scale, and scope. -Wealthy countries tend to trade with other wealthy countries.
MNEs pursuing a ________ ocean strategy tend to also pursue a transnational strategy
Blue
True or False: Though low-slilled laborers make much less in developing countries, no such difference in wages exists for high-skilled workers.
False
Firms can achieve increased competitive advantage as a result of ___________, which are firms that prduce a good or service that increase the percieved value of a focal firms offering when the two are combined.
complementors
When Walmart posted a list of banneed suppliers on its website, this was an example of __________.
corporate social responsibility
Multinational enterprises that manufacture commodity roducts that focus on cosat leadership tend to use a __________.
global standardization
With a multidomestic stratgey, products are manufactured on a local level. This has the potential of ___________.
increasing the risk of intellectual property appropriation
The Japanese market is very partiular, and MNEs tend to have a challenging time breaking into the market successfully. To provide the most local responsiveness and to influence Japanese consumers in believing that the products are local, an MNE should follow a ________ strategy
multidomestic
Which of the following factors enabled India to gain a cometitive advantage in busines process outsourcing?
-its well educated English speaking workforce -its low cost labor
What are the factors in Michael Porter's model of national competitiveness?
-related industries/complementors -factors conditions -demand conditions - cometitive intensity in focal industry
What are the four quadrants of the intergration-responsiveness framework?
-transnational strategy -multidomestic strategy -international strategy -global standardization strategy
According to ___________, consumers needs and preferences throught the world are converging and becoming increasingly homogeneous.
Levitt's globalization hypothesis
A company should only expand abroad if _________.
the benefits outweigh the costs
All other things equal, the grateer the cultural distance, ____________.
the greater the liabilitiy of foreignness
Which of the following are the most important determinants of economics distance?
- per capita income -wealth
Which of the following characteristics help make an MNE's international strategy successful?
-prominent brand names -strong reputation -large domestic markets
In global standardization strategy, the main competitive element is __________
reduced costs
In global economy, according to Porter, competitive advantages increasingly existin in ___________, such as Silicon Valley.
regional geographic clusters
A countrys natural, human, and other resources can be expressed in terms of _________.
factor conditions
When looking at the modes of foreign market entry, one could conclude that _________.
exporting might be the earliest stage of commitment because it allows the firm to test whether a foreign market is ready for its products.
Which of the following are part of culture?
-beliefs -social mores -social norms
Global-collaboration networks freely locate business functions anywhere in the world based on an optimal mix of which factors?
-capabilities -PESTEL factors -costs
During the first stage of globalization, which of the following business functions typically took place abroad?
-distribution -sales
Which of the following demensions are considered in the CAGE distance framework?
-economic distance -geographic disance -cultural distance
When a countrys demand conditions include high density urban living and high energy costs, consumers can be expected to prefer air conditions that are which of the following?
-energy efficent -quite -small
Which of the following condititions suggest a mmultidomestic strategy might be the approriate stategy for MNEs?
-high demand fro local responsiveness -host countries with idiosyncratic domestic markets -little need for cost reductions
Which of the following are benefits of a transnational strategy?
-it promotes global learning and the diffusion of best practives and innovations -It harnesses economies of scale
Which of the following have helped make glabalization possible?
-reduction in transportation costs -advances in telecommunications -reduced investment barriers
A multinational enterprise would likely be motivated to pursue a global-standardization strategy in order to __________.
-take advantage of economies of location -take advantage of economies of scale
Which of the following are distrinctive features of globalization 3.0?
-technology helps reduce communication distances -MNEs reorganize inot a more seamless global enterprise -firms create global networks of local expertise
Which of the following are among the primary considerations when determining the mod in which a firm enters a foreign market?
-the desired level of control over foreign operations -the degree of investment
Which of the following are examples of local responsiveness?
-the sale of metal chopsticks in Korea -The sale of toads in preparation in China -the sale of burgers in Japan
Leading biotechnology, software, and internet compnaies and leading computer manufacturers are concentrated in which of the following countries of states?
-the united states -china Taiwan
Which of the following are common reasons for companies to mae foreign direct investments?
-to avoid import restrictions -to reduce labor costs -to reduce tax burdens
Which of the following help shrink the administrative and political distance between countries?
-trade agreements -shared currency -a history of colonization
The decision framework that is based on the relative distance between home and a foreign target country is the ___________.
CAGE distance framework
Strategic positions _________.
Can fluctuate
Which of the following statements about the CAGE distance framework is true?
It is designed to aid MNEs in deciding where to compete in the world?
Which of the following defines national competitive advantage?
It is the extent to which a country can compete in international markets.
Multinational enterprises need an effective flobal strategy in order to ________.
achieve a competitive advantage against other companies.
At a basic level, the concept of "liability of foreignness" refers to the additional __________.
cost of doing business in an unfamiliar cultural enviroment
The cultural disparity between the internationally expanding firms home country and its targeted host country is known as _________.
cultural distance
The oldest form of internationalization is __________, which involves producing goods in one country to sell in another country.
exporting
Porter's diamond framework to explain national competitive advantage includes four interrelated factos: domand conditions, competitive intensity in a focal industry, related and supporting industries/complementors, and ___________.
factory conditions
Because World War II, business strategy, implemetation, and knowledge typically moved ___________.
from domestic headquarters to outposts abroad
As the standard of living rises in emerging economies, MNEs are hoping that ___________.
increased purchasing power will enable workers to purchase the products they used to make for exports only
Companies seek to access international markets as means o
increasing their economic value creation
Mount Mountain is a manufacturer of outdoor gear and apparel. It uses American sizing and standards for its apparel and gear across all markets. Which strategy is Mount Mountain adhering to?
international
Firms located in regional clusters benefit from _________
knowledge spillover
A benefit of an international strategy is __________.
leveraging core competences
MNEs pursuing a multidomestic strategy hope that __________.
local consumers will percieve them to be a domestic company.
The benefits to be accrued from locating value chain activities in the worlds optimal geographies for a specific activity are known as ___________ economies
location
A company that deploys resources and capabilities in the procurement, production, and distribution of goods and services in at least two countries is a _____________.
multinational enterprise
When companies face a highly competitive enviroment at home, they are more likely to _________.
outperform global competition that lacks such intense domestic competition
When pursuing an international strategy, a company ____________.
sells the same procut in both domestic and foreign markets.
