International Marketing Exam 2

Asian pacific economic cooperation

(APEC, excl. ASEAN, US and Canada) type: formal institution members: Australia, Brunei, Darussalam, Canada, Chile, China, Hong Kong, Indonesia, Japan, Malaysia, Mexico, Papua New Guinea, Peru, Philippines, Russia, Singapore, South Korea, Taiwan, Thailand, United States, Vietnam, New Zealand

hofstede cultural values

-Power Distance (PDI) -Individualism versus Collectivism (IDV) -Masculinity versus Femininity (MAS) -Uncertainty Avoidance (UAI)

ch. 6 essay question- government barriers to trade

-quotas; limits on how much of a product can be exported/imported -tariffs; tax foreign products to favor domestic products -basic regulations on products; what types of products are allowed to be sold

traditional economic system

A traditional economic system is one in which each new generation retains the economic position of its parents and grandparents. Traditional economies rely on the historic success of social customs

ASEAN

Association of South East Asian Nations type: limited trade and cooperation agreement Members: Brunei, Indonesia, Malaysia, Philippines, Singapore, Thailand, Myanmar, Cambodia, Laos, Vietnam

BRIC countries are

Brazil, Russia, India and China

________ implies that governments remove, reduce or simplify restrictions on business and individuals in order to encourage the efficient operation of markets.

Deregulation

A crude measure of a country's wealth is ________ per capita.

GNP

In which country does McDonald's not offer hamburgers made of beef?

India

How can the information on interest rates between countries help an international marketer?

Interest rate rises can influence the amount of cash a consumer has available to purchase luxury items, for example

Judging by Hofstede's cultural typology, one of the following statements is not true

Japan scores low on masculinity

Which of the following statements is true about positioning?

Positioning is the image of the product that is created in the minds of the customer(s

SME's vs LSE'sinternational marketing process (SME's portion)

SME's is often simply a reaction to a stimulus provided by a change agent (opportunity in a market). other cases include: -Low psychic distance -low cultural difference -low geographic distance. first entry decisions by selecting targets among largely unknown markets. often selling to global customers.

The term East Asian Tigers refers to the economies of

South Korea, Taiwan, Hong Kong and Singapore

NAFTA Trading Bloc

The North American Free Trade Agreement (NAFTA) is an agreement signed by the governments of Canada, Mexico, and the United States, creating a trilateral trade bloc in North America.

STP

The processes of segmentation, targeting, and positioning that firms use to identify and evaluate opportunities for increasing sales and profits.

ch. 6 essay question- regional economic integration

There are four main types of regional economic integration. 1. Free trade area. This is the most basic form of economic cooperation. Member countries remove all barriers to trade between themselves but are free to independently determine trade policies with nonmember nations. An example is the North American Free Trade Agreement (NAFTA). 2. Customs union. This type provides for economic cooperation as in a free-trade zone. Barriers to trade are removed between member countries. The primary difference from the free trade area is that members agree to treat trade with nonmember countries in a similar manner. The Gulf Cooperation Council (GCC) [1] is an example. 3. Common market. This type allows for the creation of economically integrated markets between member countries. Trade barriers are removed, as are any restrictions on the movement of labor and capital between member countries. Like customs unions, there is a common trade policy for trade with nonmember nations. The primary advantage to workers is that they no longer need a visa or work permit to work in another member country of a common market. An example is the Common Market for Eastern and Southern Africa (COMESA). [2] 4. Economic union. This type is created when countries enter into an economic agreement to remove barriers to trade and adopt common economic policies. An example is the European Union (EU)

________ are abstract ideas about what society believes to be good, right and desirable

Values

How can the difference between tariff and non-tariff barriers be best described?

Where tariff barriers are direct taxes and charges imposed on export, non-tariff barriers are much more elusive and can be disguised

Purchasing power parity (PPP)

a theory which states that exchange rates between currencies are in equilibrium when their purchasing power is the same in each of the two countries (amount of adjustment needed on the exchange rate)

tariffs

a tool used by governments to protect local companies from outside competition. the most common forms are specific, ad valorem and discriminatory

BERI

a useful tool in the coarse-grained, macro-oriented screening of international markets

Primary activities include

agricultural and extractive processes

The 30-year-old limitation on trade (imports and exports) which the US has held against Cuba is also referred to as

an embargo

self reference criterion

an unconscious reference to one's own cultural values, experiences, and knowledge as a basis for decisions. Closely connected is ethnocentrism, that is, the notion that people in one's own company, culture, or country know best how to do things.

market economic system

based on consumers and their buying decisions rather than under government control. decisions rely on supply and demand for pricing.

exports/imports consequences

can distort a nation's balance of trade and devalue its currency. The value of a currency, in turn, is one of the biggest determinants of a nation's economic performance.

mixed economic system

combines qualities of market and command systems into one. In many countries where neither the government nor the business entities can maintain the economy alone, both sectors are integral to economic success

One of the following is not a main criterion for successful positioning in foreign markets

compromise

The seven value types developed by Schwartz are

conservatism, intellectual autonomy, affective autonomy, hierarchy, mastery, egalitarian commitment and harmony

One of the targeting strategies below is known for spreading risk across market segments

differentiated

Strong exchange rates can

drive imports to become cheaper

Non-governmental organizations play a role in the promotion of global marketing by

establishing industry and trade associations, chambers of commerce, export service organizations and world trade clubs

Among the factors that affect the balance of trade figures are

exchange rates, taxes, tariffs and trade measures

Celebrity endorsement, an advertising form frequently used in Anglo-Saxon cultures, is less used in

feminine cultures

international market selection process

five stage process, and its purpose is to gauge which international market or markets offer the best opportunities for our products or services to succeed. The five steps are -Country Identification (means that you undertake a general overview of potential new markets) -Preliminary Screening (you begin to score, weight and rank nations based upon macro-economic factors such as currency stability, exchange rates, level of domestiv consumption and so on) -In-Depth Screening (detailed information on the target market is obtained so that marketing decision-making can be accurate) -Final Selection (Managers would reflect upon strategic goals and look for a match in the nations at hand) -Direct Experience (Marketing manager or their representatives should travel to a particular nation to experience firsthand the nation's culture and business practices)

masculine society

focus on values such as money, success, and competition. These cultures consist of a need for power, assertiveness, dominance, and wealth and material success.

Which one of the following is not a value type developed by Schwartz?

freedom

Arrange the following in order from the lowest to highest level of economic integration

from free trade area to customs union to common market to economic union

GNP

gross national product is the value of all goods and services produced by the domestic economy over a one year period, including income generated by the countries international activities

SMEs' choice for international market selection is often limited to

immediate neighbours

The following are examples of political risk actions

import restrictions, local content laws, exchange control, market control, price control, tax controls, labor restrictions, change of government party, nationalization, and domestication

Innovativeness, embracing the new, is something implicit

in weak uncertainty avoidance cultures

Marketers need to be aware of the cultural environment as it has strong influences on international consumer behaviour. Components of culture are

language, manners and customs, technology and material culture, social institutions, education, values and attitudes, aesthetics, and religion

SMEs have the following characteristics

low psychic distance, low cultural distance and low geographical distance

Which ones are the four main conditions for effective segmentation in international marketing?

measurability, accessibility, actionability and profitability

non-verbal language

more important in high context cultures; time, space (conversational distance between people), material possessions, friendship patterns, and business arguments.

In 1966, Lee used the term self-reference criterion (SRC) to characterize our unconscious reference to

our own cultural values

Political risk is a combination of

ownership risk, operating risk and transfer risk

Gross Domestic Product

plus/minus net income from assets (e.g. subsidiaries abroad) is GNI (=GNP)

The market for contraceptives has long been heavily influenced by which main environmental factors?

political and social

Non-tariff barriers include

quotas, embargoes and administrative delays

Power distance

refers to the degree of inequality between people in physical and educational terms

low-context cultures

rely only on spoken and written language. low degree of complexity in communication

The ________ is based upon the identification of relative changes in international import shares among various countries

shift-share approach

The shower approach is also known as the

simultaneous strategy

Compared to high-context cultures, low-context cultures rely on ________ for communication

spoken and written language

The need for explanations, structure, testing, test reports, scientific proof and advice, and testimonials by experts is specific to

strong uncertainty avoidance cultures

currency exchange

system that converts from one currency to another so that goods can be bought and sold between countries with different economies

Nationalization is defined as

takeover of foreign companies by a host government

nationalization

takeover of foreign companies by the host government

Which of the following is not an element of culture?

tax law

The difference between theoretical market size and effective market size is

the change (+/-) in stock size

When an organization selling baby products evaluates international markets with a view to entering them, a crucial factor taken into account is represented by

the demographic characteristics

The screening process involves fine-grained screening, where

the firm's competitive power and competences in the different markets are taken into account

command economic system

the government controls all economic activity. the market plays little to no role in production decisions. less flexible than market economies and react slower to changes in consumer purchasing patterns and fluctuations in supply and demand.

enculturation/inculturation

the gradual acquisition of the characteristics and norms of a culture or group by a person, another culture, etc

In the context of international marketing, culture can be defined as

the learned ways in which a society understands, decides and communicates

culture

the learned ways in which society understands, decides, and communicates

collectivism

the practice or principle of giving a group priority over each individual in it

If you were a marketer for an organization selling software products and you were assigned the task to evaluate a few international markets with a view to entering them, a crucial factor that you would take into account would be

the technological factor

GNP per Capita

total GNP divided by its population

trade barriers

trade laws (often tariffs) that favor local firms and discriminate against foreign ones

different types of economic systems

traditional, command, market, and mixed

feminine society

traditionally thought of as having conventional traits, such as being supportive, caring, and relationship oriented

European Union

type: political and economic union Members: Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania , Slovakia, Slovenia, Spain, Sweden, United Kingdom

The least demanding targeting strategy in international marketing is

undifferentiated

high-context cultures

use more elements surrounding the message. the cultural context in where the message is communicated has a lot to say. high degree of complexity in communication.

The cultural environment of a country is best defined by which characteristics?

values, attitudes, heroes, myths and symbols

The incremental strategy is also known as the

waterfall approach

aesthetics

what is meant by good taste in art, music, folklore, and drama may vary a lot from culture to culture

SME's vs LSE's international marketing process (LSE's portion)

with existing operations in many countries have to decide which of them to introduce new products into. draw on existing opertaions, have easier access to product-specific data in the form of primary information that ismore accurate than secondary. more proactive.