IB 3090 Midterm

Which of the following services are included in a Turnkey Contract?

Material supply and machinery transport Installation, assembly, and set-up, and operation of the proposed work Staff training and technical assistance ******All of the above

Vodafone Group Plc strategy when the European Commission began a lower cross-border roaming charges within the European Union. Vodafone Passport was created as an opt-in program for frequent border crossers. Aiming at the program's popularity as the basis for a targeted ________ campaign, arguing that binding regulation was unnecessary to bring down prices.

Political *****Lobbying Interest groups Social

The ________ set of ________ that the firm must interact with

relevant, bodies

The __________ of _________-_________ activities performed by a firm in the process of creating a product: R&D, procurement, manufacturing, marketing, distribution, sales and service.

sequence of value adding

The non-market environment consists of the s_____, p________, and l______ arrangements that structure the firm's interactions outside of, and in conjunction with, markets.

socia,l politcal, legal

The tendency of a financial or monetary crisis in one country to __________ __________ to other countries, due to the ongoing integration of national economies.

spread rapidly

Individuals and groups with preferences about, or a _______ in, an issue.

stake

Meeting or exceeding the ethical, legal, and commercial expectations of ___________________, i.e. being a socially responsible corporate citizen in the host country.

stakeholders

A formal arrangement between two or more countries to reduce or eliminate t________, q_______, and b_______ to trade in products and services

tariffs, quotas, and barriers

The franchisee provides ________, in a system franchising agreement.

usage rights for products and patents trademark-protected business concepts training and ongoing support ******down-payment plus royalty

The pattern or geographic arrangement of locations where the firm carries out ______-_______ activities.

value chain

Interests, as a characteristic of nonmarket environment, refer to

what nonmarket strategies address external environment in which organizations are founded *****individuals and groups with preferences about, or a stake in, an issue. what the interested parties know or believe about the relation between actions and consequences and about the preferences and capabilities of the interested parties

The firm's integrated network of sourcing, production, and distribution, organized on a ____________ ______ and located in countries where competitive advantages can be maximized.

worldwide scale

The basis of the pyramid of ethical conduct is___.

Corporate social responsibility Ethical behavior Guarding against corruption ******Complying with laws and regulations

The European Union is the largest political union comprising of 27 countries in Europe.

False

There are no cross-national differences faced by companies in terms of infrastructure, regulation, language, buyer demographics and behavior, payment methods, and currencies.

False

what the interested parties know or believe about the relation between actions and consequences and about the preferences and capabilities of the interested parties

information

Ethical standards are ____________ , and firms and individuals should seek to consistently uphold them anywhere in the world.

universal

Sean, Freedom's senior manager, adheres to the relativist interpretation of ethical principles. He goes by the saying, "When in Rome, do as the Romans do." Sean is most likely to agree strongly with which of the following views?

********Freedom should passively accept the practices that prevail in countries where it does business. Freedom should not partner with foreign business entities. Freedom should institute a single global code of conduct for all its employees and suppliers. Freedom should not hire foreign managers

________ refers to the tendency of a financial or monetary crisis in one country to spread rapidly to other countries, due to the ongoing integration of national economies.

*******Contagion Nationalization Internationalization Co-determination

Which of the following can NOT be considered as new Digital Realities in International Marketplace?

*******Remarkable rise of digitally enabled MNEs Quickened flows of knowledge and information Central role of digital infrastructure Huge change of consumer power

LeShaun Golding researched the risks linked to establishing the plant in Country B. He cited government intervention, lack of local managerial talent, challenges in communication and unethical business practices as the most prominent risks for this location. LeShaun noted all of the following types of risks EXCEPT

*******currency risk political risk country risk cross-cultural risk

An arrangement in which a contractor supplies managerial know-how to operate a hotel, hospital, airport, or other facility in exchange for compensation.

******Management contract Leasing Turnkey contracting Equity-based collaborative venture

Which of the following is an example of licensing?

******Saks Inc. entered China by giving a retail chain in China the authority to use Saks Fifth Avenue name for a flagship department store in Shanghai. An Indian automobile manufacturing company buys engines from a Japanese manufacturer for its environmentally friendly cars. A South-Korean consumer electronics manufacturer produces the screens for its brand of television and sends orders to a factory in China to manufacture the casing for the television. A U.K-based motorcycle manufacturer produces limited-edition customizations of the company's stock models and sells it to customers around the world.

Which of the following best describes Pure local adaptation strategy?

******Strategy that applies to conditions in which cross-border barriers or geographic distance renders attempts to achieve global scale efficiencies futile. A cost-effective strategy aimed at providing a wide range of products at the most competitive prices. A strategy aimed at achieving high local responsiveness while also achieving high global integration. A strategy aimed at improving local responsiveness. Companies may take advantage of market-specific characteristics such as Web site layout, local language and currency, examination and return policies, payment options, and customer support.

Which of the following claims about leasing is TRUE?

******The focal firm's ability to gain immediate access to target markets is a major advantage. In return for a lump-sum payment, the lessor relinquishes ownership of the property. It is a high-risk, high-cost strategy for entering into a foreign market. It is a contract under which a contractor provides management expertise in return for payments to run a hotel, hospital, airport, or other facility.

Which of the following describes the promotion of free trade ties between two or more geographically related nations?

******economic bloc trading diaspora grey market business strategic unit

________ is the total value of products and services produced in a country over the course of a year.

*****GDP CAD FDI PPP

Which of the following claims about intellectual property infringement is TRUE?

*****It amounts to piracy which takes the form of manufacture and distribution of counterfeit goods. Because of subjective ethical norms, counterfeiting and piracy can be especially problematic in advanced economies The right to keep valuable intellectual property out of the hands of rivals. Heavy machinery and computer manufacturing are the most widely counterfeited products.

Under the __________, Canada, Mexico, and the United Staes have eliminated nearly all tariffs on product imports from each other.

*****USMCA GATT FTAAP APEC

Philip Baxter reported on the risks associated with establishing the plant in Country A. The most significant risk, in his view, was posed by the government's complex bureaucratic structure. Philip reported the likelihood of significant administrative delays in opening the plant. The risk identified by Philip is an example of which of the following?

*****country risk commercial risk currency risk cross-cultural risk

When applying the five-step framework for making ethical decisions, managers should ________, at first.

*****recognize the ethical problem implement a decision evaluate alternatives examine the facts

A company with _______ or ________ employees (in Canada and the U.S.)., or 250 or fewer employees in the EU and elsewhere.

500 or fewer

Which of the following is TRUE with regard to the rights approach?

According to the rights approach, the most important virtues are truth and prudence. ******It is based on the belief that, regardless of how you deal with an ethical dilemma, human dignity must be preserved. It is based on the belief that the best action treats everyone equally and fairly. It produces the greatest balance of good over harm to customers, employees, shareholders, the community, and the natural environment

What are the advantages of Regional Integration?

Acquire stronger defensive and political posture Achieve scale economies and enhanced productivity Attract direct investment from outside the bloc *********All of the above

What are the advantages of franchising to the franchisee?

Acquire training and know-how; receive ongoing support from the franchisor Operate an independent business Become part of an established international network ******All of the above

Companies can choose the following strategy to address the institutional challenges in emerging markets

Adapt your strategy Change the context Stay away *****All of the above

While of the following is(are) characteristics of a successful regional economic integration?

Economic similarity Political similarity Cultural similarity *******All of the above

_________firm is international from almost inception.

Entrepreneurial

__________ represent a significant force in the Globalization of Markets.

Export controls Prohibitive tariffs *********Continued reductions in trade restrictions Import controls

Which of the following is an example of offshoring?

Fahad, a resident of the UAE, can share his views—data and information—about the country's construction industry with his friends in the U.S. ******The IT support services for customers of Mayfair Inc., a U.S. based consumer electronics manufacturer, are based in India. Treat Corp. is a food and beverage manufacturer based in Texas. It decided to move from Houston to Fort Worth in Texas to cut production costs. Lin, a Chinese citizen, decides to move to the U.K. after her application for scholarship is accepted by a leading university in London.

A common market has a lower degree of integration than a customs union.

False

A course of action must be established as soon as the ethical dilemma is identified, according to the process for arriving at ethical decisions.

False

Ethical principles are standardized around the world.

False

International business today is predominantly the domain of large, multinational companies.

False

Market infrastructure in emerging countries is largely the same, and companies need to deploy similar strategies to succeed.

False

Members of free trade areas agree to introduce common tariffs and non-tariff barriers that apply to products from non-member nations, allowing free trade between them.

False

One of the disadvantages of licensing is that it requires the licensor to make a high capital investment in the foreign market.

False

J.I. case company's decision to standardize its tractors and focus on a handful of models to serve the EU market is considered to be?

Internationalization from outside the bloc *******Regional standardization of products Internationalize value chain activities Trade diversion

The popularity of Konbini in Japan mainly presents the following challenges of internet markets?

Language User demographics *****Payment system Currency

downstream activities

Marketing, distribution, and sales and service

Which of the following best describes Global low-cost strategy?

Strategy that applies to conditions in which cross-border barriers or geographic distance renders attempts to achieve global scale efficiencies futile. *****A cost-effective strategy aimed at providing a wide range of products at the most competitive prices. A strategy aimed at achieving high local responsiveness while also achieving high global integration. A strategy aimed at improving local responsiveness. Companies may take advantage of market-specific characteristics such as Web site layout, local language and currency, examination and return policies, payment options, and customer support.

Which of the following best describes Transnational cost-adaptive strategy?

Strategy that applies to conditions in which cross-border barriers or geographic distance renders attempts to achieve global scale efficiencies futile. A cost-effective strategy aimed at providing a wide range of products at the most competitive prices. ********A strategy aimed at achieving high local responsiveness while also achieving high global integration. A strategy aimed at improving local responsiveness. Companies may take advantage of market-specific characteristics such as Web site layout, local language and currency, examination and return policies, payment options, and customer support

Sovereignty

The ability of a nation to govern its own affairs.

Institutional void refers to?

The abundance of specialized intermediaries, regulatory system and contract-enforcing mechanisms ******The absence of specialized intermediaries, regulatory system and contract-enforcing mechanisms The abundance of foreign investment and local competitions The absence of foreign investment and local competitions

Which of the following statements is TRUE about the firm-level consequences of market globalization?

The globalization of markets has narrowed down new business opportunities for internationalizing firms. ***********Globalization drives firms to relocate key value-adding activities to the most advantageous locations around the world. A firm's value chain is not subject to internationalization. Through offshoring, a firm relocates a major value-chain activity by establishing a factory or subsidiary in the home market.

The ________ and ______________ activities by companies across national borders.

Trade, investment

A Company may face high adverse impact on failure to adopt CSR behaviors.

True

Both market and nonmarket strategies should be considered in addressing and defending against market forces and realizing market alternatives.

True

Governments have facilitated economic integration by lowering barriers to international trade and investment, harmonizing their monetary and fiscal policies within regional economic integration blocs.

True

International business is performed not just by individual firms, but also governments and international agencies.

True

It is important to integrate nonmarket strategies with market strategies.

True

The globalization of markets refers to the growing independence and self-sufficiency of countries worldwide.

True

The initial phase of globalization was triggered by the introduction of the railroads and ocean transport.

True

Under a build-operate-transfer (BOT) arrangement, a firm or consortium of firms contracts to build a major facility abroad and then transfers ownership to the project sponsor, typically the host-country government or public utility.

True

Payment methods and customs vary widely from country to country. In China, ________ is the major payment method.

Visa Mastercard Discover *****Alipay

The ____________ of specialized intermediaries, regulatory systems, and contract-enforcing mechanisms

absence

International business is also known as which of the following?

born global business laissez-faire business ******cross-border business multi-hub business

Third stage of regional integration- trade barriers are reduced or removed, common external barriers are established and products, services, and factors of production such as c______, l____ and t__________ are allowed to move freely among the member count

capital, labor, technology

Second level of regional integration- similar to a free trade area except that the member states harmonize their external trade policies and adopt __________ tariff and nontariff barriers on imports from nonmember countries.

common

It is most likely that a person who believes in ethical normativism would interpret ethical behavioral standards as:

constantly changing ******universal superior to religious beliefs dependent on societal norms

Idea generation, idea ___________, idea diffusion

conversion

Strategy that seeks to achieve ____ ______________ in order to offer a wide selection of goods at the most competitive prices.

cost effectiveness

Identify critical competencies, 2) _______ an ___________, and 3) develop transfer processes.

create, architecture

Which of the following would NOT be considered an example of foreign direct investment (FDI)?

cross-border purchase of a textile plant *******cross-border purchase of stocks purchase of capital assets of a foreign company purchase of foreign land for business operations

Which of the following types of risk is also known as political risk?

currency risk cross-cultural risk commercial risk ******country risk

Enabling or transforming business functions, operations, and activities by leveraging ________ technologies and digitized data.

digital

Which of the following stages of regional integration does USMCA represent?

economic union common market *****free trade area political union

The globalization of finance ________.

enables companies to minimize offshoring **********contributes to firms' abilities to develop and operate world-scale production and marketing discourages innovation discourages free international exchange of goods and services

Cross-border exchange of products (merchandise) and services (intangibles) typically through __________ and _____________.

exporting and importing

The value-adding activity is delegated to an ___________ ___________, as opposed to being internalized within the company.

external supplier

To simplify the foreign operation and reduce potential risks, firms leveraging internet market for global expansion should use English in their websites for different countries.

false

Fourth stage of regional integration- member countries enjoy all the advantages of early stages, but also strive to have common _________ and ___________ policies.

fiscal and monetary

Trademarks, copyrights, and patents are examples of.

fundamental rights ******intellectual property rights ethical rights tangible property rights

Strategy that applies to conditions in which cross-border barriers or geographic distance renders attempts to achieve global scale efficiencies ________.

futile

Strategy that seeks to achieve high local responsiveness and high ______ ___________..

global integration

Which of the following is a societal consequence of market globalization?

greater emphasis on proactive internationalization internationalization of firm's value chain new risks and instant rivalry from foreign competitors *******offshoring and the flight of jobs

________ or ___________ created by individuals/firms.

ideas or works

Firms that are more successful at global competition display each of the following qualities EXCEPT ________.

identifying foreign market opportunities aggressively ********approaching internationalization from a reactive standpoint actively pursuing partnerships with foreign firms focusing intensively on building organizational capacities

Strategy that seeks to achieve ______ _______________. Firms may play to the peculiarities of each market such as Web site design, local language and currency, examination and return policies, payment options, and customer service.

local responsiveness

The relocation of manufacturing and other value-chain activities to cost-effective _________ ____________.

locations abroad

Which of the following represents the final stage in a firm's value chain?

marketing procurement research and development *******sales and service

A large company with many resources whose business activities are performed by a network of subsidiaries located in __________ _____________.

multiple countries

Which of the following is NOT an example of a cross-cultural risk factor?

negotiation patterns decision-making styles *****costs of production ethical practices

A concerted pattern of actions taken in the non________ ______________to create value by improving its overall performance.

non market environment

What non_______ ______________ address.

non market strategies

Ethical truths are ____ __________ but differ from group to group.

not absolute

Research and development, ________________ , and manufacturing.

procurement

The ___________ of selected value-adding activities, including production of intermediate goods or finished products, from external independent supplies.

procurement

The method of replicating properties without compensating those that developed them originally is known as______.

product differentiation bribery *******counterfeiting trademarking

The nonmarket strategies become most important when

the level of government intervention in the market is low the level of government intervention in the market is moderate ******the level of government intervention in the market is high none of the above

In a licensing agreement, the licensee provides ________.

the rights to use its industrial design the knowledge and supporting products, which includes raw substances and components intellectual property, technical information, and assistance *****a combination of down-payment plus royalty payments

A value chain is ________.

the sequence of administrative policies implemented to promote economic integration by a government the process of relocating manufacturing and production to valuable and cost-effective locations abroad the process of integrating national economies during a financial crisis ********the sequence of value-adding activities performed by a firm in the course of developing, producing, marketing, and servicing a product

Cross-border investment is the _________ of __________ to another country or the acquisition

transfer, assets

A nonmarket strategy allows a company to shape the environment in which it operates, creating opportunities.

true

Digitalization refers to enabling business functions, operations, and activities by leveraging digital technologies and digitized data.

true

In a global economy, sustained competitive advantage arises from tackling social, political and environmental issues as part of a corporate strategy — not just pursuing business as usual

true

New markets coming online will quickly be dominated by a small number of global platforms such as Facebook.

true