ch. 4 mgmt

A group of 21 Pacific Rim countries whose purpose is to improve economic and political ties is known as the ____.

Asia-Pacific Economic Cooperation

According to Rosabeth Moss Kantor of the Harvard Business School, the events that set up conditions for the global economy in the 1980s were when the ____.

Berlin Wall came down, Asian countries opened their economies to foreign investors, and there was a worldwide trend of governments deregulating their economies

George, who owns an international grocery store in Ohio, has benefited highly from the trading bloc that allows him to purchase food products from Central American nations at a nice discount. With many of his customers from Costa Rica, the Dominican Republic and Guatemala, he has benefited from the trading bloc known as _____.

CAFTA-DR

The trading bloc consisting of 28 trading partners in Europe is the ____.

European Union

The agreements of the World Trade Organization are based on ____.

GATT

Licensing is when a company ____.

allows a foreign company to pay it a fee to make or distribute the first company's product or service

Ethnocentric managers believe that their native country, culture, language, and behavior _____.

are superior to all others

Countertrading is ___ goods for goods.

bartering

Tom, who owns a successful business with two locations and a few international clients, was approached by a large organization about dramatically expanding his company. Tom later told his wife that he is happy with his success, but he wants to stay small because if he decides to add new products, small companies ____.

can get started more easily and maneuver faster

The hallmark of great civilizations has been great systems of ____.

communications

According to the findings of the GLOBE project, the assertiveness dimension represents the extent to which a society values ____.

confrontation and competitiveness

Don's Carpet installed carpet at no cost for City Office Supply, in exchange for $1,000 of office supplies. This is an example of ____.

countertrading

Susan, from Iowa, arrived in Saudi Arabia and immediately noticed that the way Saudi men treat women is vastly different than how men in the U.S. treat women. Susan was feeling uncomfortable because she was experiencing ___.

culture shock

The United States granted to China most favored nation trading status, which ____.

describes a condition in which a nation, such as China, receives favorable trading treatment

During global culture training for a group of employees who are being transferred to Egypt, Sam, the HR training manager, remarked that "in the Arab world, men have long handshakes and they hold hands and kiss cheeks, which is meant to express ____."

devotion and equality in status

China has been accused by shrimpers in South Louisiana of selling shrimp in the United States at a lower price than U.S. suppliers to drive down the price of American shrimp. The U.S. shrimpers are accusing the Chinese of ___.

dumping

Quotas are designed to prevent _____.

dumping

The United States has prohibited the import of sugar and cigars from Cuba. This is an example of a(n) ____.

embargo

John, a construction manager, has been having problems finding quality employees in some of his foreign offices. While speaking with his attorney, Alisha, he mentioned that "in our locations overseas, many of our good employees have been quitting, and as you know, we have numerous lawsuits over personnel policies." Alisha explained that historically, these types of issues are a result of ____ policies.

ethnocentric

While traveling in France, Jim and his wife, both Americans, were concerned about how much they can afford to spend in Europe because sometimes the U.S. dollar will buy more goods and sometimes it will buy less, based on changing economic conditions. This change in the values of currencies and how they fluctuate in relation to each other is known as the ____ rate.

exchange

Greg, who is from Florida and a geologist for ExxonMobil, decided transfer to an office in Saudi Arabia. Greg is a(n) ____.

expatriate

Alice's Pasta Kitchen makes quality pasta and sells its products to customers in other countries. This is an example of ____.

exporting

A government's seizure of a domestic or foreign company's assets is known as ____.

expropritation

A foreign subsidiary is a subsidiary that is partly owned by a foreign government and partly owned by an organization or stockholders.

false

A nonprofit organization with operations in several states is a multinational organization

false

A small but groundbreaking committee, headed by Al Gore, that theorized global warming was known as the GLOBE project

false

A trading bloc, also known as global or local trade associations, consists of groups of global or local organizations that meet on a regular basis to market their products at trade shows or conferences.

false

Amy, the CEO of a large manufacturing organization, knows that many of her competitors have closed their American factories to utilize production facilities in Mexico because labor is cheaper there and they receive special privileges in return for employing Mexican citizens. However, Amy refuses to shift her operations down south, believing that it is important to keep jobs in the U.S., despite the cost savings. These manufacturing plants that are allowed to operate in Mexico, with special privileges in return for employing Mexican citizens, are known as internationldoras.

false

An Indian company has been exporting a technology product to American customers and is marketing its product at a price that is well below the price charged by American companies to drive down the price of the American product. This is an example of countertrading.

false

An import quota is a trade barrier in the form of a customs duty, or tax, levied mainly on imports.

false

Canada is the top nation the United States exports to, and Mexico is the country it imports the most from.

false

Certain industries, like telecommunications and financial services, are especially suited for being midsize and local, so these companies are not trying to become bigger or merge with other big companies.

false

Countertrading is a decision by an organization to never accept the market price from its suppliers, but to save money by negotiating a lower price.

false

David, an owner of a small business, is researching the current value of his products when they are bartered on the global market. This market rate of an organization's products when they are bartered is known as the exchange rate.

false

Developing a more globally interdependent system defines nationalism.

false

Don, a Texan, is a geologist employed with an oil drilling company who lives and works in Iran. Don is an example of a global-patriot.

false

Employers have found that there is agreement among most religions of the world as to what is the most important work-related value.

false

Foreign companies have built plants in the United States, slowly revitalizing parts of industrial America, with foreign direct investment only at 5% of America's GDP. In addition, companies based overseas provide jobs for about 1% of U.S. workers.

false

Great civilizations have had the characteristic of a strong economy, despite their communication problems.

false

Horatio, the CEO of a struggling company, is excited about his trip to New York City to start participating in a global bartering group that will develop business relationships and exchange their products and services. This is an example of free trade.

false

In 1999, the top exporting nation was the United States, but in 2013 the world's top exporting nation was Japan.

false

Jose, the owner of a citrus farm in Mexico, discovers the United States is offering a new larger tariff on the import of Mexican-grown oranges A tariff is a bonus paid to foreign companies by the American government on imported products.

false

Keith Reinhard of the nonprofit group Business for Diplomatic Action said, "Americans are seen throughout the world as compassionate, caring people, who are helpful and soft spoken."

false

Learning how to enhance the American global image of being a "caring, wonderful person" is part of becoming a world citizen.

false

Many companies are moving production outside the United States because of the effects of geopolitics, a trend known as deglobalization.

false

NAFTA is a trading bloc consisting of the United States, Canada, Panama, and Mexico

false

One advantage of small companies over large organizations is the ability to make decisions more slowly and methodically if needed, which gives small companies a global advantage in terms of time and distance over large companies.

false

One of the smaller but very vital trading blocs in Europe, with 27 trading partners in Europe and Africa, is the Mercosur.

false

Over the last two years an American computer manufacturer has partnered with a technology organization in Japan to develop and produce computers and printers benefiting both organizations. This is an example of countertrading.

false

People first begin to learn their culture when they start utilizing social media, technology, such as the Internet, and watching television.

false

People of different cultures have different ideas about what is acceptable interpersonal space and can carry a sexual connotation, such as men holding hands may raise eyebrows in the Middle East.

false

Peter Agnefjäll, president and CEO of the IKEA Group, spends plenty of time with IKEA employees at all levels. This is an example of individualism/collectivism, which refers to the amount of time the managers, especially upper and middle management, spend with their employees.

false

Philippe is from the Mediterranean coast of Greece and Sasha is from Iran. In their grocery store, this married couple is used to focusing on one task at a time rather than multitasking. This focused work habit by Philippe and Sasha is based on polychronic time.

false

Phillip, the global sales manager for a cosmetic company, believes that employees and managers in each of his foreign stores understand best how to handle the personnel and practices in their locations. So when a corporate executive approached Phillip about reprimanding Aki, the Tokyo store manager, for not doing things as corporate dictates, Phillip backed Aki. Phillip feels the home office should leave her alone. Phillip is an example of an ethnocentric manager.

false

Susan, a teacher, is interested in helping children in other countries learn how to read. She has formed an international nonprofit organization that travels to several nations in Africa to donate books and work in schools as tutors. Susan's organization is an example of a multinational corporation.

false

Technology, such as e-mail and videoconferencing, works best to show commitment to customers and handle joint ventures and mergers.

false

The IMF operates as a first or primary lender that makes short-term loans to countries suffering from unfavorable balance of payments because of imports, exports, and other matters.

false

The Johnson family in Ohio approached Top Builders, an American construction company specializing in new homes, to build their new home. To complete its jobs, Top Builders likes to support small, locally owned American companies that specialize in high-quality products. The use by Top Builders of suppliers outside its company to provide goods and services is known as global outsourcing.

false

The availability of goods, people, and money to be able to move more freely worldwide is known as the flexible economy.

false

The greenfield venture is a strategic alliance with individuals and organizations in third-world nations, in order to assist, educate, and share the risks and rewards of starting a new nonprofit organization in their country.

false

The process whereby managers are able to utilize Microsoft Excel to improve the record-keeping related to marketing their products and services is known as e-commerce.

false

The study of international management is not important for some people because most individuals and companies are not affected by global companies.

false

To help American companies, the U.S. government utilizes import quotas, which encourage foreign countries to increase the number of goods exported to the United States.

false

Two managers from an Electronics Mart were talking to Ty, their district manager, about Harriet, the unpopular store manager. Susan, the assistant manager, said, "I believe I speak for other managers and employees when I say that Harriet acts like she knows it all. We all feel that Harriet does not listen to any of us because she always thinks her way is right and does not want to consider any other opinion." Harriet is an example of a geocentric manager; geocentricism is also called parochialism.

false

Recent protests against World Bank operations involve complaints of supporting countries permitting sweatshop labor or that restrict religious freedom, and _____.

financing projects which could damage the ecosystem

Technology philosopher Nicholas Negroponte proposed that the global market driven by electronic information "_____."

forces things to get bigger and smaller at the same time

The law that makes it illegal for employees of U.S. companies to make "questionable" or "dubious" contributions to political decision makers in foreign nations is the _____.

foreign corrupt practices act

Luxere Hotels International, an American company, sells the rights to other hospitality companies globally to open hotels with the Luxere name for a fee and a share of the profit, in return for using Luxere's brand name and a package of materials and services. This defines ____.

franchising

Roberto, the vice president of marketing, is talking to Francis, a sales manager in a foreign office, about several local situations that Francis's reps are facing in their territory. Roberto tells Francis that he believes there are differences and similarities between home and foreign personnel and practices, and that Francis should use whatever techniques are most effective. Trey is an example of a(n) ____ manager.

geocentric

The IMF has ____.

helped support some weaker European countries during the recent financial crisis

Anna, the owner of a café, attended an entrepreneurial conference where they spoke about in-group collectivism from the GLOBE project, which expresses ____.

how much pride and loyalty people should have for their family or organization

The United States limits the amount of cheese purchased from other countries; this policy is a type of ____.

import quota

Dominique owns an international grocery store where customers can purchase products from other countries. Dominique's store is an example of a company that ____.

imports

Hannah, an engineer for an oil company, is interested in working overseas at this stage of her life because she knows that foreign work experience demonstrates ____ to potential employers.

independence, resourcefulness, and entrepreneurship

Sometimes a country's laws forbid foreigners from ownership within their nation, and the only way an American company can have a presence in that foreign country is with a(n) ___.

joint venture

The GLOBE project is an ongoing cross-cultural investigation of nine cultural dimensions involved in ___ processes.

leadership and organizational

When communicating across cultures, the best option regarding language use is _____.

learn the local language

NAFTA and CAFTA are ____.

major trading blocs

Mexican manufacturing plants with low labor costs and special privileges given to their American owners in return for employing Mexican citizens are known as ____.

maquiladoras

The WTO was formed to ____.

monitor and enforce trade agreements

Free trade is the ____.

movement of products between countries without political or economic obstruction

Tops Burger, based out of Texas, has locations in 25 countries. Tops is a ____.

multinational corporation

Shoes International is a global nonprofit organization that works with schools and various companies to donate shoes to children in poverty throughout the world. Shoes International is an example of a ____.

multinational organization

Becoming a world citizen includes being global in focus and learning how _____.

not to be an "ugly American"

Globalization is the trend ___.

of the world economy toward becoming a more interdependent system

Quality Air, a company that builds airplanes, typically utilizes other production companies that specialize in certain parts for its jets; this practice is known as ____.

outsourcing

Ethnocentrism is also known as _____.

parochialism

George, a regional manager for a global corporation, is meeting with several upset managers from the Rome plant about Steve, the Rome facility manager originally from Florida. Phillipe, the assistant manager, tells George "We all feel that Steve only sees things his way and very seldom considers our perspective on things." Steve's management style can be described as ____.

parochialism

Maria, the vice president of sales for an international organization, believes that employees in her foreign offices understand best how to handle the personnel and practices in their offices. So when the corporate HR manager approached Maria about scolding Robert, the Paris, manager, for not doings things according to corporate policy, Maria backed Robert and said, "I believe that the home office should leave Robert alone because he best understands the local culture." Maria is an example of a(n) ___ manager.

polycentric

Tom and his fiancé Susan decided to have their wedding on a beach in Acapulco, Mexico. Some services for the wedding, such as the limousine and the catering services, were local. Throughout the weekend of the wedding, the couple found that workers and things for their wedding arrived late. In response, the Mexican workers remarked, "Ustedes tiene que ser flexibles," which in English means, you have to be flexible with time. This attitude regarding time is considered _____.

polychronic time

Monochronic time is a ___.

preference for doing one thing at a time

A tax on automobiles imported into the United States that raises prices on imported vehicles to make the price of cars produced here more competitive is a(n) ______; a tax on all oil imported into the United States, which is implemented to raise money for the American government, is known as a(n) ____.

protective tariff, revenue tariff

The World Bank is the principal organization that ______.

provides low-interest loans for improvements in developing nations

In a low-context culture ____.

shared meanings are primarily derived from written and spoken words

Technology Experts is a U.S. company that specializes in IT research. It has formed a joint venture with Processor Inc., a Canadian organization that has a reputation of producing quality PCs, to market laptops in China, sharing the risks and rewards of starting the new enterprise together. This is an example of a(n) ___.

strategic alliance

Like other international companies, Jane is interested in expanding her candle business globally primarily to ___.

take advantage of supplies, new markets, and lower labor costs

Prior to 1990, the United States imposed a tax on automobiles imported from Mexico. This type of tax is a(n) _____.

tariff

Last week Paul, CEO of Quality Furniture in South Carolina, traveled to Europe to visit customers. While overseas, Paul checked his e-mail daily and visited his company's website to show to customers. After visiting the last customer Friday morning, Paul was able to return to the corporate office to meet with his board of directors that night. This "shrinking" of time and space with air travel and electronic media defines ____.

the global village

According to the watchdog group Public Citizen, NAFTA is responsible for

the loss of 845,000 U.S. jobs

a nation's culture is ________.

the shared set of beliefs, values, knowledge, and patterns of behavior common to its people

As part of becoming a world citizen, Joe, who is from Michigan and who is transferring to the Paris office, is trying to do things to ___.

think local and keep a global focus

An import quota is a(n) ____.

trade barrier

The United States uses government regulations, such as tariffs, embargoes, and import quotas, to limit the import of goods and services and protect their U.S. industries against foreign competition. This use of these regulations is known as ____.

trade protectionism

ASEAN is a(n) _____.

trading bloc consisting of 10 countries in Asia

A company that produces boats, which is headquartered in Japan, formed a new company in the United States to avoid paying a tariff on its boats manufactured for the U.S. market. This new company is an example of a subsidiary.

true

A condition in which a country grants other countries favorable trading treatment, such as the reduction of import duties, is known as a "most favored nation" trading status

true

A likely reason for modern outsourcing is the lower cost of labor in another country.

true

A manufacturing facility in a Mexico was unable to afford the products it needs from an American supplier because Mexico's currency dropped dramatically. To acquire the parts needed to produce its products, the Mexican facility bartered with several companies in Texas, offering completed goods for parts. This direct exchange of goods for goods is known as countertrading.

true

A negative effect of global economic interdependency is the movement, or outsourcing, of formerly well-paying jobs overseas as companies seek cheaper labor costs

true

ABC Investments has been advising customers financially since 1902. In 1989, ABC was able to open an office in Berlin, after the Berlin Wall came down. Later, ABC opened several offices in Asia when several Asian countries opened their economies to foreign investors, then as governments began to deregulate their economies, ABC was able to allow their global customers to move their money freely around the world. ABC Investment's experience is evidence of the three historic global changes which Rosabeth Moss Kantor of the Harvard Business School spoke of.

true

Adriana, a CEO, is interested in expanding her clothing business globally. She loves the excitement and challenge of forming something new that is totally owned and controlled by her organization, knowing that the risky investment will possibly yield a large return. Adriana's desire to form a firm that is totally owned and controlled by her company is an example of a wholly owned subsidiary.

true

After a morning of global cultural training, Marie, the vice president of marketing, was having lunch with Ann, who will be managing the new office in South Korea. Marie tells Ann, "There are cultural differences between the U.S. and South Korea that will affect the success of our office. For example, I suggest giving a couple of cans of Spam to your larger customers because Spam is considered elegant." Marie's advice to Ann is good, based on the fact that there are all kinds of cultural differences American managers have to get used to in other countries.

true

Aiden, the purchasing manager for a company that produces high-end, quality medical equipment, is interested in meeting with the management of Diamond Cut, a production facility in the state that specializes in intensive research, precision assembly, and complex technology. Aiden's organization is less likely to offshore the manufacture of its products, and want to meet face-to-face with Diamond Cut because Diamond produces high-end products.

true

Becoming a world citizen includes being global in focus, but thinking local, learning what's appropriate behavior, knowing your field, and becoming at least minimally skilled in the language of the local country.

true

Before you travel and conduct business abroad, spend some time learning about other patterns of interpersonal communication, such as in Afghanistan, where a man does not ask another man about his wife.

true

Consisting of 159 member countries, the World Trade Organization is designed to monitor and enforce trade agreements.

true

Dawn grew up helping her father work on cars in his auto repair shop and developed into an excellent auto technician. Because of stereotypes regarding women in this field, she is interested in finding a shop that minimizes gender discrimination and role inequalities. This describes an organization that, according to the GLOBE project, is high in gender egalitarianism.

true

Don, the CEO of Pie Technology, announced in a conference call the corporate strategic goal of operations in several countries. When this long-term vision by Don is realized, it would qualify Pie Technology as a multinational corporation.

true

Farm Supply has decided to allow a retailer in Canada to utilize the Farm Supply name and a number of valuable business services in return for paying the company a fee and part of its profits. This business arrangement is known as franchising.

true

Franchising is a form of licensing in which a company allows a foreign company to pay it a fee and a share of the profit in return for using the first company's brand name and a package of materials and services.

true

Greg, a manager at the Rome, Italy, store for an American-owned cell phone company, understands the differences and similarities between American and the Italian customers, customs, culture, and practices. As a result, Greg is very skilled at utilizing either the American or Italian technique that helps him market his products and services to customers in Rome. Greg is an example of a geocentric manager.

true

Jamil, who is a successful salesperson, is interested in working for an organization that supports its employees and offers a compensation package based on performance improvement and excellence. This describes an organization that, according to the GLOBE project, is high in performance orientation.

true

Multinational organizations expand to take advantage of availability of supplies, new markets, and lower labor costs or to avoid tariffs and import quotas.

true

Out of GATT came a series of "rounds," or negotiations, that resulted in the lowering of barriers, such as the Uruguay Round.

true

Pat is concerned about better knowing the cultural tendencies of her business partners and competitors in Europe and Asia. Pat would be interested in knowing this information because according to the GLOBE project, this can give her a strategic competitive advantage.

true

Paul McDonald, executive director of recruitment firm Robert Half Management Resources, said, "Anyone with international experience will have a leg up, higher salary, and be more marketable."

true

Prior to NAFTA, the United States implemented a number of tariffs to protect the auto industry and farmers against foreign competition. A tariff is an example of trade protectionism.

true

Recently, the IMF has been more concerned with addressing income inequality, which has worsened in most countries in the past three decades.

true

Sally has seen such great interest in her scented candles that she has decided to start her own small business selling them. One benefit that Sally's company can achieve with the Internet and the World Wide Web is that her organization can operate globally, helping her get started more easily because she can put products on a website and sell worldwide, with the advantages of distribution and scope that large companies have

true

The United States imposed a ban on the import of products from Iran due to the political situation in that nation. This disallowing of imports is known as an embargo.

true

The degree to which people accept inequality in organizations and social situations is known as power distance.

true

There are two types of tariffs: a revenue tariff, designed simply to raise money for the government; and a protective tariff, which raises the price of imported goods to make the prices of domestic products more competitive.

true

To complete the Johnson family's new home in Ohio, Top Builders, an American construction company specializing in new homes, utilized a Swiss company that specializes in fine-quality doors, using the wood of trees from the Alps region. Top's use of a foreign company's products and labor is known as offshoring.

true

While in Italy, Tony was able to communicate important information to George, his business partner, via e-mail. Later that day, Tony remarked to George about how helpful it was that he was able to return to their office in New York in less than nine hours. This "shrinking" of time and space as air travel and the electronic media have made it easier for people around the globe to communicate with one another defines the global village.

true

Within the European Union, most internal trade barriers have been eliminated, giving the EU an association of borderless neighbors and the world's largest free market.

true

Don, who owns an investment firm with customers worldwide, has witnessed how dangerous global economic interdependency can be. During a lunch meeting he mentioned to a customer, "I certainly have seen two negative effects for the United States of global economic interdependency: ___."

vast surplus funds from global investments flowing into the United States and loss of well-paying jobs

Donald enjoys the excitement and challenge of forming a firm in Europe that is totally owned and controlled by his company because he knows that although the investment will be substantial, it could result in a large return. This type of organization is an example of a ____.

wholly-owned subsidary