International Business final

The Smoot-Hawley Act was aimed at

avoiding rising unemployment

________ entails even closer economic integration and cooperation than a common market.

An economic union

The most typical joint venture is a _____ venture.

50-50

_____ staffing policy seeks the best people for key jobs throughout the organization, regardless of nationality.

A geocentric

_____ allow a firm to rapidly build its presence in the target foreign market.

Acquisitions

Which of the following statements is true regarding an international business?

An international business must find ways to work within the limits imposed by government intervention.

The _____ obliges member states to make the bribery of foreign public officials a criminal offense and excludes facilitating payments made to expedite routine government action from the convention.

Convention on International Business Transactions

_____ refers to the relationship between the country of assignment and how well an expatriate adjusts to a particular posting.

Cultural toughness

Four main institutions make up the political structure of the EU. Which of them is responsible for proposing EU legislation, implementing it, and monitoring compliance with EU laws?

European Commission

Which is the most enduring free trade area in the world?

European Free Trade Association (EFTA)

There are several disadvantages of franchising as an entry mode. Which of the following is one of them?

Franchising may inhibit the firm's ability to take profits out of one country to support competitive attacks in another.

The most widely practiced theocratic legal system in the modern world is

Islamic

Which of the following is a disadvantage of licensing?

It does not give a firm the tight control over strategy that is required for realizing experience curve and location economies.

Which of the following is a major benefit of engaging in free trade?

It gives countries access to products that they cannot produce.

Which of the following is true of the IMF?

It has emerged as a significant player in the global economy.

Why doesn't Great Britain use the euro as its national currency?

It would have to relinquish control of its monetary policy to the EU.

_____ predicts that the power of microprocessor technology doubles and its cost of production falls in half every 18 months

Moore's Law

_____ is the ability to understand why people of other countries behave the way they do.

Perceptual ability

Which of the following statements about small-scale entry is true?

Small-scale entry is a way to gather information about a foreign market before deciding whether to enter on a significant scale.

Identify the true statement about trade barriers.

To conform to local content regulations, a firm may have to locate more production activities in a given market than it would otherwise.

The _____ establishes a uniform set of rules governing certain aspects of the making and performance of everyday commercial contracts between sellers and buyers that have their places of business in different nations.

United Nations Convention on Contracts for the International Sale of Goods (CISG)

Trade unions around the world

are widely varied in their structure.

Which of the following explains why economic integration has never been easy to achieve or sustain, despite the strong economic and political arguments in support?

While a nation as a whole may benefit significantly, certain groups may lose.

A _____ may be paid to ensure that the expatriate enjoys the same standard of living in the foreign location as at home.

cost-of-living allowance

Three countries agree to remove barriers to trade between member countries and adopt a common external trade policy toward nonmembers. They also agree to allow people and other factors of production to move freely across their borders. Which level of economic integration is this an example of?

common market

An organization's norms and value systems are known as its

corporate culture

Many states in Asia, Latin America, and Western Europe have shifted away from a mixed economy to a market-based economy. Which of the following measures is most likely to be promoted by such states?

deregulation of the economy

A company that sells its product in a foreign market below the cost of production may be accused of

dumping

The Uruguay Round provided

enhanced protection for patents, trademarks, and copyrights.

It is in the best interest of prospective employees to find out all they can about the

ethical climate in an organization.

The premature return of an expatriate manager to his or her home country is known as

expatriate failure

An antagonistic relationship between management and labor classes may result in lower costs of production.

false

Hofstede's study found that in masculine cultures, sex roles were less sharply distinguished, and little differentiation was made between men and women in the same job.

false

The Republic of Elbow has a command economy, and as such, its objective is to encourage free and fair competition between private producers.

false

The Trade-Related Aspects of Intellectual Property Rightsagreement attempts to reduce intellectual property protections to enhance trade.

false

XYZ Toys manufactures and sells small quantities of each of its products, but it can still benefit from economies of scale.

false

Early entrants to a market that are able to create switching costs that tie customers into their products or services are capitalizing on

first-mover advantages

A Japanese executive's ritual of presenting a business card to a foreign business executive is an example of

folkways

In a seminal study, R.L. Tung found that among American multinationals, the biggest impediment to expatriate success was the

inability of the spouse to adjust.

_____ refers to a society that allows relatively free gratification of basic and natural human drives related to enjoying life and having fun.

indulgence

A civil law system tends to be less adversarial than a common law system because the

judges' decisions are based on detailed legal codes.

In some countries, the official GNI per capita measured at PPP data does not reflect the actual total annual income because

large amounts of economic activity may be in the form of barter agreements.

A _____ is more likely to capture first-mover advantages associated with demand preemption, scale economies, and switching costs.

large-scale entrant

Large-scale strategic commitments may

limit strategic flexibility

In a _____, any individual who has an innovative idea is free to try to make money out of that idea by starting a business (by engaging in entrepreneurial activity).

market economy

Which of the following factors is likely to make a country a more attractive location for international business?

market-based economic policies

Which of the following enables managers to walk away from a decision that is profitable, but unethical?

moral courage

A country's balance-of-payments accounts keep track of the

payments to and receipts from other countries for a particular time period.

The costs of promoting and establishing a product offering when a firm enters a foreign market prior to its rivals are known as ________ costs.

pioneering

Identify the theory that argues that advanced nations have an incentive to develop new consumer products and hence such nations always tend to create a good or service for the first time.

product life-cycle

According to Amartya Sen, development should be

seen as a process of expanding the real freedoms that people experience.

Business ethics that either deny the value of business ethics or apply the concept in a very unsatisfactory way are termed

straw man

According to Hernando de Soto, which of the following factors is essential for the developing world to be able to reap the benefits of innovation and entrepreneurship?

strong property rights

According to Ricardo's theory of comparative advantage, a country should produce goods

that has lower opportunity cost.

Which of the following focuses on making low-interest loans to cash-strapped governments in poor nations that wish to undertake significant infrastructure investments?

the World Bank

What was the long-term goal of international trade secretariats (ITSs)?

to be able to bargain transnationally with multinational firms

Building an organization culture that places a high value on ethical behavior requires incentive and reward systems.

true

Max Weberbelieved that Protestantism encouraged capitalism's development by emphasizing the importance of wealth creation and frugality.

true

first-mover advantages

true

A hardship allowance is paid

when the expatriate is being sent to a location where basic amenities are grossly deficient by the standards of the expatriate's home country.