AÞV allir krossar
________ refers to the confusion and anxiety experienced by a person who lives in a foreign culture for an extended period, and it can affect the expatriate or family members and results from an inability to cope with the differences experienced in a foreign environment. A) Culture shock B) Culture pluralism C) Enculturation D) Segregation
A) Culture shock
________ is the most common way of identifying market segments within a country. A) Demographics B) The Internet C) Gap analysis D) Psychographics
A) Demographics
________ is a form of locking the value of a country's currency onto another currency. A) Dollarization B) Monetarization C) Managed floating D) Floating
A) Dollarization
Which of the followings BEST describes trade protectionism? A) Governmental actions to influence international trade are known as protectionism. B) Governmental policies to remove all trade barriers are known as protectionism. C) Governmental programs that encourage companies to export only are known as protectionism. D) Governmental actions to help foreign companies enjoy zero tax rate are known as protectionism.
A) Governmental actions to influence international trade are known as protectionism.
Which of the following does NOT characterize the "maturity stage" of the product life cycle (PLC) theory? A) Increases in exports by the innovating country B) Production start-ups in emerging economies C) More product standardization D) Increased competitiveness of price
A) Increases in exports by the innovating country
Which of the following BEST describes a company that follows a social marketing orientation? A) It considers political and safety dimensions of its products. B) It is a not-for-profit entity based in a developed country. C) It is a government-owned entity from an emerging economy. D) It generates sales to niche markets using social networking sites.
A) It considers political and safety dimensions of its products.
Euroloans are often quotes at which of the following rates? A) LIBOR B) the euro rate C) prime plus 2 percent D) prime plus .5 percent
A) LIBOR
The process of shifting production from a domestic to a foreign location is best known as ________. A) offshoring B) outsourcing C) licensing D) joint venturing
A) Offshoring
________ requires that an entirely new product be developed for the target market when many important differences exist between the home and target markets. A) Product invention B) Product adaptation C) Dual adaptation D) Dual extension
A) Product invention
________ means meeting humanity's needs without harming the ability of future generations to meet their needs. A) Sustainability B) Corporate social responsibility C) Ethical behavior D) Casuistry
A) Sustainability
Which of the followings is NOT a non-economic rationale for governments to intervene in international trade? A) To fight unemployment B) To preserve national culture C) To maintain essential industries (especially defense) D) To promote acceptable practices abroad
A) To fight unemployment
What is an equity alliance? A) a collaborative arrangement in which at least one collaborating company takes an ownership position in the other B) a collaboration in which each contributor receives an equitable return based on relative contribution C) a collaboration in which partners agree to share technology with each other D) a wholly owned acquisition to prevent appropriation of intellectual property
A) a collaborative arrangement in which at least one collaborating company takes an ownership position in the other
What is a turnkey operation? A) a contract for a large construction project, often for a government agency B) a contract with a government to service one of its key industries C) the buying of another company D) the repatriation of equity
A) a contract for a large construction project, often for a government agency
The customary means by which a company fills up vacancies in its offices is called ________. A) a staffing policy B) an employment policy C) onboarding D) outsourcing
A) a staffing policy
A company that makes a foreign investment largely to acquire knowledge is most likely to use ________ as a means of expansion. A) an acquisition B) internalization C) a greenfield investment D) a licensing agreement
A) an acquisition
Which of the following best describes an expatriate? A) an employee who is assigned to live and work in a foreign country for an extended period B) an employee who returns to his home country after a foreign assignment C) an employee hired on a temporary basis by an MNE D) an employee who is a host-country national
A) an employee who is assigned to live and work in a foreign country for an extended period
A go-no-go decision means ________. A) an individual project decision is based on whether the project meets threshold criteria B) projects are ranked and approved from the top of the list down until available resources are exhausted C) management reviews existing information and decides whether additional individualized feasibility studies are warranted D) projects are approved or disapproved based on the potential ease of divestment
A) an individual project decision is based on whether the project meets threshold criteria
The most common predeparture training for an expatriate is ________. A) an informational briefing B) role playing C) in-depth cultural seminars D) language training
A) an informational briefing
Advantages of adopting a polycentric approach include which of the following? A) capitalizing on the availability of qualified local managers B) helping transfer core competencies from the home nation to local subsidiaries C) increasing the international career mobility for local managers D) offsetting tendencies for the company to adapt excessively to the local market
A) capitalizing on the availability of qualified local managers
Someone who uses past trends in exchange rates themselves to spot future trends known as a ________. A) chartist B) de facto economist C) Chief Financial Officer D) monetary administrator
A) chartist
In a democracy, ________. A) citizens have the right to participate in the decision-making process B) the opportunity to truly participate in the political process is restricted to a select few C) the court system is directly supervised by the political system D) the rights of the individual are merged with the state
A) citizens have the right to participate in the decision-making process
A guideline for responsible action by a firm in its operations worldwide is a(n) ________. A) code of conduct B) corporate monitoring policy C) education program D) honor code
A) code of conduct
Hard currencies are usually ________. A) convertible B) undesirable assets C) non- convertible D) unstable
A) convertible
All of the following are benefits of countertrade EXCEPT ________. A) decreasing trade protectionism B) increasing access to innovative technology C) developing new trade relationships with foreign companies D) preserving foreign-exchange reserves
A) decreasing trade protectionism
Appropriability theory refers to ________. A) denying rivals access to competitive resources such as management know-how B) categorizing the appropriateness of a firm's foreign investments in terms of host country objectives C) explaining an investing firm's choice of partner in a joint
A) denying rivals access to competitive resources such as management know-how
Firms using a(n) ________ primarily use parent country nationals to staff higher-level foreign positions. A) ethnocentric staffing model B) polycentric staffing model C) geocentric staffing model D) monocentric staffing model
A) ethnocentric staffing model
The four types of interpretative frameworks in international businesses are ________. A) ethnocentric, polycentric, regiocentric and geocentric B) ethnocentric, intercentric, polycentric and monocentric C) monocentric, neocentric,geocentric and polycentric D) intracentric, geocentric, ethnocentric and neocentric
A) ethnocentric, polycentric, regiocentric and geocentric
In high-context cultures, ________. A) feelings and thoughts are not explicitly expressed B) information is readily shared C) people have high sensory involvement D) nonverbal communication is not important
A) feelings and thoughts are not explicitly expressed
Which of the following is NOT one of the three common ways that private trade intermediaries are paid by exporters? A) fixed salary B) buy-sell basis C) commission rate D) special event contribution
A) fixed salary
Which type of exchange rate arrangement is based on supply and demand? A) floating B) hard peg C) crawling D) soft peg
A) floating
If a foreign currency is quoted in American terms (the direct quote) and the forward rate is greater than the spot rate, the foreign currency is selling at a ________. A) forward premium B) forward discount C) backward discount D) discounted premium
A) forward premium
In addition to protection, tariffs serve to ________. A) generate revenue B) subsidize exports C) subsidize imports D) increase consumption
A) generate revenue
Which of the following is NOT one of the three personality traits that specifically affect international marketing? A) globalism B) materialism C) consumer ethnocentrism D) cosmopolitanism
A) globalism
The widening set of interdependent relationships among people from different parts of the world is known as ________. A) globalization B) offshoring C) franchising D) outsourcing
A) globalization
Ongoing research confirms that MNEs with superior ________ practices correlate to high productivity, value creation, and a competitive advantage. A) human resource B) human capital C) expatriate D) parent-country
A) human resource
The basis for designing an effective export strategy most likely begins with ________. A) identifying and developing the firm's core competencies B) hiring local personnel in target markets to build the business C) enlisting the support of an export management company D) simultaneously targeting a large number of foreign markets
A) identifying and developing the firm's core competencies
Which term refers to restricting imports in order to boost domestic production and consumption of goods that would otherwise be imported? A) import substitution B) terms-of-trade C) most-favored nation D) in-sourcing
A) import substitution
The perspective of ________ holds that as a company gains experience, resources, and confidence, it progressively increases its scope of countries to which it exports. A) incremental internationalization B) export management C) the born-global theory D) serendipity
A) incremental internationalization
Fundamentally, countertrade is best described as a(n) ________ transaction. A) inefficient B) common C) desirable D) simple
A) inefficient
Which of the following international assignment preparation methods helps expatriates better navigate life in the host country? A) language training B) field experience C) sensitivity training D) cultural orientation
A) language training
All of the following are reasons a country might institute import restrictions to improve its balance of trade position with other countries EXCEPT to ________. A) maintain essential industries B) reduce imports and encourage exports C) get comparable access for its companies D) bargain away restrictions by other countries
A) maintain essential industries
The trade theory that says a country should export more than it imports is known as __________. A) mercantilism B) import substitution C) comparative advantage D) absolute advantage
A) mercantilism
Ethical dilemmas tend to be ________ for MNE managers than for domestic managers. A) more complicated B) less controversial C) easier to decide D) less common
A) more complicated
A city or country that provides large amounts of funds in currencies other than its own is a(n) ________. A) offshore financial center B) ADR facilitator C) interbank market D) currency regulator
A) offshore financial center
Managers may purposely crowd a market to prevent competitors from gaining advantages is known as ________. A) oligopolistic reaction B) concentration strategy C) liability of foreignness D) a harvesting strategy
A) oligopolistic reaction
Geographic and demographic influences are called ______________ that affect how companies produce and market products, employ personnel, and even maintain accounts. A) physical factors B) important factors C) micro factors D) institutional factors
A) physical factors
People generally prefer little consultation between superiors and subordinates in cultures where ________ is high. A) power distance B) fatalism C) individualism D) self-actualization
A) power distance
There is growing consensus that human resource managers must hire, develop, reward, and retain people whose performance explicitly improves the ________. A) productivity of the firm's core competencies B) fit between the firm's practices and industry standards C) firm's engagement of political authorities D) firm's responsiveness to customer complaints
A) productivity of the firm's core competencies
Nontradable goods are BEST defined as ________. A) products and services which have high transportation costs B) factors of production that exceed safety regulations C) goods used for national defense D) products that comprise a portion of the inputs for finished products
A) products and services which have high transportation costs
A promotional strategy designed to create buyer demand that will encourage channel members to stock a company's product is called a ________. A) pull strategy B) push strategy C) retrenchment strategy D) stability strategy
A) pull strategy
All of the following are ways to control currency convertibility EXCEPT ________. A) purchasing power parity B) multiple exchange rates C) import deposits D) import licenses
A) purchasing power parity
A ________ is a numerical limit on the quantity of a good that may be imported into a country during some time period. A) quota B) numerical export control C) voluntary export restraint D) regulatory control
A) quota
For the provider, management contracts offer the advantage of ________. A) receiving income without making a capital outlay B) increasing their merchandise exports C) reducing their global taxes D) better access to raw materials
A) receiving income without making a capital outlay
Comparing countries in international business is LEAST useful for determining the ________. A) selection of which managers to send to which countries B) sequence of entering different countries C) amount of resources to allocate in each country D) best location for sales and production
A) selection of which managers to send to which countries
The most internationally mobile factor of production is ________. A) short-term capital B) management C) long-term capital D) labor
A) short-term capital
In comparing international and domestic marketing, it is best to state that ________. A) similar principles are at work B) mass-market orientations are most effective C) principles differ for product and price, but not for advertising D) the differences between them can be studied through gap analysis
A) similar principles are at work
Leverage is _________. A) the degree to which a firm funds the growth of the business by debt B) the degree to which a firm funds the growth of the business by current assets C) the degree to which a firm funds the growth of the business by intangible asset D) All of the above
A) the degree to which a firm funds the growth of the business by debt
When no single company has control over a collaborative arrangement, ________. A) the operation may lack direction B) none of the partners is responsible for legal violations C) differences in corporate culture are likely to grow D) one partner's interests are likely to be put ahead of the other partner's interests
A) the operation may lack direction
An MNE in which new knowledge and capabilities are developed in both domestic and foreign locations, both independently and jointly, and then diffused throughout the worldwide organization, is following a ________ strategy. A) transnational B) localization C) global D) matrix
A) transnational
Which of the following refers to the extent to which people can tolerate risk in their lives? A) uncertainty avoidance B) long-term versus short-term orientation C) power distance D) individualism
A) uncertainty avoidance
All of the following countries have an authoritarian political system except _________. A)South Korea B) Chad C) Turkmenistan D) North Korea
A)South Korea
________ can occur when a firm sells its goods in a foreign market at a price below what it charges in its home market. A) Predatory pricing B) Dumping C) Foreign trade duties D) Subsidies
B) Dumping
________ is term that consists of currencies issued by countries other than one's own. A) Eurozone B) Foreign exchange C) Floating exchange D) International monetary fund
B) Foreign exchange
________ is the buying of products made in other countries for use or resale in one's own country. A) Exporting B) Importing C) Merchandising D) Transporting
B) Importing
Which is not necessarily a valid assumption of absolute and comparative advantage? A) Specialized labor seeks efficiency. B) Labor resources are fully employed. C) Countries pursue objectives other than economic efficiency. D) Production networks enable countries to concentrate on particular functions.
B) Labor resources are fully employed.
Which of the following factors helps stabilize culture? A) Marketing strategies B) Language and religion C) Lecture and seminar D) Definitions and regulations
B) Language and religion
Which of the following statement is NOT true according to Adam Smith's theory of absolute advantage in which specialization allows countries to increase their efficiency. A) Larger amount of production would provide incentives for developing more effective working methods. B) Management costs would be cheaper by hiring only local managers. C) Labor would not lose time in switching production from one kind of product to another. D) Labor could become more skilled by repeating the same tasks.
B) Management costs would be cheaper by hiring only local managers.
_________ consists of shares in or loans to a company (or country) in the form of bonds, bills, or notes purchased by the investor. A) Blue investment B) Portfolio investment C) Low risk investment D) Excessive investment
B) Portfolio investment
Why should managers have an understanding of trade protectionism? A) Trade protectionism targets factor endowments, thus affecting the best country to locate production. B) Trade protectionism affects a company's ability to sell abroad and ability to compete at home. C) Trade protectionism affects the number of people permitted to practice a specific profession. D) Trade protectionism prevents companies' enactment of merger and acquisition agreements.
B) Trade protectionism affects a company's ability to sell abroad and ability to compete at home.
A foreign direct investment occurs when ________. A) a company owns at least 25% of a foreign firm B) a company has a controlling interest in a foreign company C) foreign ownership is in private rather than government securities D) a foreign firm agrees to a licensing agreement with a large conglomerate
B) a company has a controlling interest in a foreign company
In international trade, what is a quota? A) a guarantee by one country to buy some minimum amount from another B) a quantitative limit on the amount of a product that can be imported or exported C) a countertrade arrangement that establishes the value of imports and exports D) a bilateral agreement calling for mutual access to markets
B) a quantitative limit on the amount of a product that can be imported or exported
The theocratic law system is based on _____________. A) a law theory B) a religious doctrine C) a combination of other law systems D) behavior of different individuals
B) a religious doctrine
The CFO's function in a company focuses on ________. A) improving distributor relationships B) acquiring financial resources C) handling accounting issues D) creating financial statements Answer: B
B) acquiring financial resources
Most world trade takes place ________. A) between developed countries and developing countries B) among developed countries C) among developing countries D) between raw material exporters and manufacturing exporters
B) among developed countries
The interbank market in foreign exchange is where ________. A) electronic brokerage systems are required B) banks trade currency with each other C) reporting dealers set exchange terms D) remittance payments are made
B) banks trade currency with each other
Which of the following is the LEAST likely reason that consumers would prefer domestically made products over imports? A) nationalism B) belief that imports are subsidized C) belief that domestic products are better D) fear that foreign made goods may not be delivered on time
B) belief that imports are subsidized
According to the teleological approach, individuals base moral decisions on ________. A) personal and social responsibilities B) consequences of an action C) cultural value systems D) opinions of peers
B) consequences of an action
A strategy that focuses on lowering operating costs is referred to as a ________ strategy. A) differentiation B) cost leadership C) niche market D) diversification
B) cost leadership
The theory of country size holds that countries with larger land masses usually________ than smaller ones. A) depend less on agricultural products B) depend less on trade C) depend more heavily on trade D) depend more on e-commerce
B) depend less on trade
A major criticism of offshoring is that it ________. A) increases production costs B) exchanges good jobs for bad jobs C) threatens the sovereignty of larger countries D) allows companies to avoid payment of any taxes
B) exchanges good jobs for bad jobs
A bond that is issued by Nestle, a Swiss company, which is denominated in yen and sold to residents of Japan is most likely a ________. A) Eurobond B) foreign bond C) global bond D) country fund
B) foreign bond
Outright forward transactions involve the exchange of currency on a future date beyond two business days at a fixed exchange rate, known as the ________. A) option rate B) forward rate C) spot rate D) reverse transaction rate
B) forward rate
The ________ of compensation determines an expatriate's compensation on the prevailing pay scales in the locale of the foreign assignment. A) headquarters-based method B) host -based method C) culturally based method D) home based method
B) host based method
In international business, marketing is concerned with ________. A) disseminating the organizational culture of a firm across global subsidiaries B) identifying, measuring, and pursuing customer needs and market opportunities abroad C) maintaining a steady flow of product-based innovations D) interacting with global business leaders
B) identifying, measuring, and pursuing customer needs and market opportunities abroad
The most common type of tariff is the ________ tariff. A) export B) import C) transit D) ad valorem
B) import
Most of the world's goods and services are sold ________. A) in international markets B) in the countries where they are produced C) through exports to small countries D) through exports to large countries
B) in the countries where they are produced
The purchasing power parity theory claims that a change in relative ________ between two countries must cause a change in ________ in order to keep the prices of goods in two countries fairly similar. A) exchange rates; inflation B) inflation; exchange rates C) interest rates; inflation D) interest rates; exchange rates
B) inflation; exchange rates
A U.S. firm owns 100% of its production facility in Brazil; thus it is most likely using a(n) ________ strategy. A) comprehensive ownership B) internalization C) appropriability D) vertical integration
B) internalization
What is the process of planning and executing the conception, pricing, promotion, and distribution of ideas, goods, and services to create exchanges across national boundaries that satisfy individual and organizational objectives? A) globalization B) international marketing C) organizational design D) international management
B) international marketing
Both absolute and comparative advantage theories assume that ________ is the only resource used in the production process. A) land B) labor C) capital D) equipment
B) labor
A driving factor for the growth in imports is the impact of ________. A) government programs B) labor specialization C) consumer preferences D) social trends
B) labor specialization
Which of the following ideas holds that a government should NOT interfere in business affairs? A) collectivism B) laissez-faire C) the rule of man D) pluralism
B) laissez-faire
Which of the following is most likely a benefit for firms that participate in the global capital market? A) numerous investment opportunities B) large pool of financing sources C) equally balanced capital structure D) quick sale of stocks and bonds
B) large pool of financing sources
An example of a first-mover advantage in international operations is ________. A) gaining economies of scale at a lower output level than competitors B) lining up the best suppliers and distributors before competitors enter the market C) using a small country for market tests prior to entering a large country D) increasing sales response functions and customer service
B) lining up the best suppliers and distributors before competitors enter the market
According to the optimum tariff theory, a foreign producer will most likely ________. A) ship highly taxed goods internationally on a per-unit basis B) lower its export prices if the importing country imposes an import tax on its products C) assess a tax on goods shipped internationally based on a percentage of the goods' value D) seek import tariffs by using the comparable access argument
B) lower its export prices if the importing country imposes an import tax on its products
A culture in which people prefer to finish one task before starting another is most accurately characterized as which of the following? A) low-context B) monochronic C) pragmatic D) high power-distanceAnswer: B
B) monochronic
Which of the following is the price at which the trader is willing to sell foreign currency? A) bid B) offer C) spread D) cross rate
B) offer
A(n) ________ is the right but not the obligation to buy or sell a foreign currency within a certain time period or on a specific date at a specific exchange rate. A) forward rate B) option C) offer D) bid
B) option
Diversity of international markets and currency instability have the greatest effect on ________. A) promotion B) pricing C) branding D) distribution
B) pricing
The primary objective of the International Monetary Fund is to ________. A) encourage euro adoption B) promote exchange rate stability C) establish a unilateral system of payments D) foster the power of the foreign-exchange market
B) promote exchange rate stability
What is the gray market? A) sales targeted to elderly consumers B) selling goods through unofficial distributors C) a legal black market run by governments D) selling counterfeit merchandise
B) selling goods through unofficial distributors
Which stakeholder group primarily wants additional sales and increased productivity? A) customers B) shareholders C) society at large D) government
B) shareholders
Which of the following best explains why U.S. firms typically place earlier and greater emphasis on expansion into Canada and the United Kingdom? A) most significant sales opportunities B) similarities in culture and legal systems C) availability of necessary natural resources D) government incentives for allied nations
B) similarities in culture and legal systems
Which of the following is an exchange rate that requires delivery of the traded currency within two business days? A) forward rate B) spot rate C) cross rate D) prime rate
B) spot rate
In the spot market, the ________ is the difference between the bid and offer rates and is the trader's profit margin. A) bid B) spread C) cross rate D) offer
B) spread
Human Resource Management (HRM) refers to the range of activities that a company, whether solely domestic or thoroughly global, undertakes to ________. A) direct its strategy B) staff its operations C) improve its responsiveness D) integrate business functions
B) staff its operations
All of the following are features of the diamond of national advantage theory EXCEPT ________. A) firm strategy, structure, and rivalry B) strategic trade policy regulations C) related and supporting industries D) demand conditions
B) strategic trade policy regulations
A company would most likely export at a price lower than its production and distribution costs in order to ________. A) use a skimming strategy abroad before using one domestically B) test a market before making a big commitment C) use a cost-plus strategy globally D) encourage gray market sales
B) test a market before making a big commitment
What is an international joint venture? A) an international agreement between two or more companies to have access to each other's patents B) the ownership of a company by two or more companies, of which at least one is a foreign company where the venture is located C) an international agreement between two or more firms for the use of a trademark D) an agreement between two or more organizations to share management expertise
B) the ownership of a company by two or more companies, of which at least one is a foreign company where the venture is located
Which of the following types of agents moves international cargo, facilitates shipment tracking, and handles product returns for exporters and importers? A) trade intermediaries B) third party logistics C) customs brokers D) freight forwarders
B) third party logistics
What is the primary reason for technology licensing to take place while a product is still in the developmental stage? A) to enable the licensor to receive some earnings in case the technology never becomes operative B) to ensure that a product launches in various countries at about the same time C) to gain funds to complete the development D) to reduce transaction costs
B) to ensure that a product launches in various countries at about the same time
The HRM requirements of a(n) ________ strategy are well matched with a geocentric staffing policy. A) localization B) transnational C) domestic D) international
B) transnational
According to Adam Smith's theory of absolute advantage, specialization allows countries to increase their efficiency for each of the following reasons EXCEPT ________. A) labor could become more skilled by repeating the same tasks B) transportation costs could be lowered by producing closer to markets C) labor would not lose time in switching from the production of one kind of product to another D) higher production would provide incentives for the development of more effective working methods
B) transportation costs could be lowered by producing closer to markets
If the inflation rate in Country A is higher than the inflation rate in Country B, value of the currency in Country A in relation to Country B would ________. A) strengthen B) weaken C) remain the same D) drop in relation to the currency of all other countries
B) weaken
What factor increases globalization? A) Changes in political situations and government policies B) Development of services that support IB C) All of the above D) None of the above
C) All of the above
The value of IMF's special drawing rights (SDR) is based on five currencies. Which of the below is NOT one of them? A)Chinese Yuan B) Euro C) Australian Dollar D) Japanese Yen
C) Australian Dollar
Acquiring and allocating financial resources among the company's activities and projects is the responsibility of the ________. A) accounting function of the firm B) external auditors C) CFO D) financial marketing manager
C) CFO
A major component of most companies' strategies for ethical and socially responsible behavior is known as _________. A) Corporate law B) Entry code C) Code of conduct D) Product code
C) Code of conduct
________ consists of specific learned norms based on attitudes, values, and beliefs of a group of people. A) Ethnology B) Civilization C) Culture D) Doctrine
C) Culture
The market consisting of all the world's currencies that are banked outside their countries of origin is called the ________. A) foreign exchange market B) interbank market C) Eurocurrency market D) offshore financial center
C) Eurocurrency market
In which of the following transactions is a currency switched with another on one date and then switched back on a future date? A) reverse transaction B) spot transaction C) FX swap D) outright forward transaction
C) FX swap
Which of the following best defines international business? A) It includes all economic flows between two or more countries. B) It includes all private economic flows between two or more countries. C) It includes all business transactions involving two or more countries. D) It includes all business transactions in countries other than your home country.
C) It includes all business transactions involving two or more countries.
________ is a contractual arrangement in which a firm in one country allows the use of its intellectual property by a firm in a second country in return for a royalty payment. A) Leasing B) Franchising C) Licensing D) Merchandising
C) Licensing
Why is London most likely the top market for trading foreign exchange? A) The British pound is the world's top trading currency. B) Most multinational firms are headquartered in London. C) London is uniquely positioned geographically in terms of time zones. D) British traders have always been the most sophisticated in the world.
C) London is uniquely positioned geographically in terms of time zones.
________ is the process of dividing the firm's total customer base into homogeneous clusters in a way that allows management to formulate unique marketing strategies for each group. A) Brand management B) Customer relationship management C) Market segmentation D) Market diversification
C) Market segmentation
All of the following countries have a totalitarian political system EXCEPT ________. A) China B) Russia C) South Korea D) Saudi Arabia
C) South Korea
________ involve the exchange of currency the second day after the date on which the two foreign-exchange traders agree to the transaction. A) FX swaps B) Outright forward transactions C) Spot transactions D) Reverse transactions
C) Spot transactions
Which of the following statements is correct? A) All exchange rates involving the US Dollar are called cross rates. B) The only important FX trading hub is in New York. C) The US Dollar is the most important currency on the global FX market. D) All of the above
C) The US Dollar is the most important currency on the global FX market.
An example of a Eurocurrency is ________. A) US Dollars held by the Federal Reserve Bank in New York B) US Dollars held by Deutsche Bank in Los Angeles C) US Dollars held by Facebook in Dublin D) None of the above
C) US Dollars held by Facebook in Dublin
Neomercantilism describes the approach of countries that try to run a favorable balance of trade to ________. A) build up gold reserves B) lower their rates of inflation C) achieve a social or political objective D) buy raw materials more cheaply
C) achieve a social or political objective
The purchase of an existing company or facility is known as a(n) ________. A) greenfield investment B) licensing C) acquisition D) equity joint venture
C) acquisition
Why do international HR managers most likely need to adjust hiring, firing, and training methods on a country-by-country basis? A) ensure compensation equity B) comply with international laws C) adjust for national and cultural differences D) meet requirements of joint venture contracts
C) adjust for national and cultural differences
The ________ approach to expatriate compensation equalizes purchasing power across countries; this helps employees enjoy the same living standard in their foreign posting that they enjoyed at home. A) merit B) equalization C) balance sheet D) differential
C) balance sheet
Ethnocentrism in international business refers to the ________. A) study of group ethics and approaches to corporate social responsibility B) comparison of the Protestant ethic with other religious views C) belief that what works best at home should work best everywhere D) ethnic segmentation of marketing programs within countries
C) belief that what works best at home should work best everywhere
Which of the following types of political risks often are caused by ethnic conflict or civil disorder and include those random political developments that adversely affect the operations of all companies in a country? A) systemic political risk B) procedural political risk C) catastrophic political risk D) distributive political risk
C) catastrophic political risk
Home-country nationals are ________. A) used a great deal abroad by polycentric companies B) citizens of the countries in which they are working C) citizens of the country where the company is headquartered D) noncitizens of the countries in which they are working
C) citizens of the country where the company is headquartered
Companies using a sales orientation find their greatest ability to sell the same product in more than one country when ________. A) promotional programs are identical in each country B) the product is a household item C) consumer characteristics are similar D) the product has a low-price relative to incomes
C) consumer characteristics are similar
Which of the following is a special ability of a company that competitors find extremely difficult to equal? A) comparative advantage B) absolute advantage C) core competency D) economy of scale
C) core competency
When divergent cultures come in contact, ________ occurs. A) power distance B) culture shock C) cultural collision D) group membership
C) cultural collision
Contact among countries brings about cultural change, which is a process called ________. A) cultural collision B) cultural imperialism C) cultural diffusion D) polycentrism
C) cultural diffusion
The shared values, attitudes, and beliefs of a group of individuals constitute a ________ A) state B) region C) culture D) community
C) culture
An exporter that implements a(n) ________ strategy does so with the intent to develop its own international marketing capability. A) indirect selling B) freight forwarding C) direct exporting D) export intermediation
C) direct exporting
International marketing differs from domestic marketing in that ________. A) marketing principles are different B) consumers prefer domestically made merchandise C) environmental variations require applying principles differently D) low prices are a more important competitive factor in foreign markets
C) environmental variations require applying principles differently
A(n) ________ is the value of one country's currency expressed in relation to the currency of another country. A) tariff B) quota C) exchange rate D) subsidy
C) exchange rate
The ________ of a firm is the share of its total output that is exported. A) freight forward B) incremental export C) export intensity D) intermodal export
C) export intensity
Which of the following transactions refers to the sale of goods or services produced by a company based in one country to customers that reside in a different country? A) importing B) countertrading C) exporting D) freight forwarding
C) exporting
The UN Global Compact is best described as a(n) ________. A) corruption mandate B) environmental initiative C) external code of conduct D) international trade guideline
C) external code of conduct
A foreign-exchange contract that is an agreement between two parties to buy or sell a particular currency at a particular price at a particular date as specified in a standardized contract to all participants in the specified market is known as a(n) ________. A) spot contract B) forward contract C) futures contract D) equity currency contract
C) futures contract
A firm that builds a new manufacturing facility in a foreign market is participating in a(n) ________. A) acquisition B) merger C) greenfield investment D) equity participation
C) greenfield investment
During which stage of the international product life cycle theory does demand rise and remain sustained for a fairly lengthy period of time? A) product decline stage B) new product stage C) growth product stage D) standardized product stage
C) growth product stage
The ________ sets the expatriate's salary in terms of the salary of a comparable job in the city where the MNE has its headquarters. A) host-based method B) home-based method C) headquarters-based method D) culturally based method
C) headquarters-based method
A company should probably use a concentration strategy for international expansion when there are ________. A) high needs for product adaptation and low growth in each market B) short competitive lead times and low spillover effects C) high growth rate and long competitive lead times D) low sales stability and short competitive lead times
C) high growth rate and long competitive lead times
In ________ cultures, people expect others to understand unarticulated moods, subtle gestures, and environmental clues. A) high-contact B) low-contact C) high-context D) monochronic
C) high-context
In terms of political risk, it is most accurate to state that high risk ________. A) affects all geographic regions of a country equally B) affects all foreign companies in the same manner C) if avoided, may lead to higher competitive risk D) triggers government turnovers
C) if avoided, may lead to higher competitive risk
The principle that an individual has the freedom to pursue his or her interests is called ________. A) socialism B) totalitarianism C) individualism D) collectivism
C) individualism
Which term refers to two or more companies that share ownership of an FDI? A) turnkey operation B) transnational firm C) joint venture D) franchise
C) joint venture
The lower survival rate of foreign companies in comparison to local firms for many years after they begin operations is known as ________. A) ethnocentric reaction B) polycentric reaction C) liability of foreignness D) most-favored-nation behavior
C) liability of foreignness
Under mercantilism, governments sought to influence trade by ________. A) establishing bilateral trading agreements with other countries B) limiting exports C) limiting imports and subsidizing exports D) encouraging the development of manufacturing in their colonies
C) limiting imports and subsidizing exports
The HRM requirements of a(n) ________ strategy are well matched with a polycentric staffing policy. A) transnational B) international C) localization D) global
C) localization
According to the theory of success and reward expectation, the greatest enthusiasm for work generally occurs when there is a ________ certainty of success combined with a ________ reward for success compared to the reward for failure. A) high; high B) high; low C) low; high D) low; low
C) low; high
Which of the following is generally the most costly information source for companies? A) reports from government agencies B) reports from international agencies C) marketing research and consulting companies D) the internet
C) marketing research and consulting companies
In terms of international business, it is most accurate to say that ________. A) there is a universal "best way" to conduct business B) global competition affects large companies but not small ones C) most firms depend either on foreign markets and supplies or compete against companies that do D) government regulation of international business has little effect on a company's profits
C) most firms depend either on foreign markets and supplies or compete against companies that do
The belief that there are universal standards of behavior that all cultures should follow is called ________. A) humanism B) relativism C) normativism D) naturalism
C) normativism
When selling a commodity for which there is little possibility of product differentiation, a company would likely use which of the following orientations internationally? A) sales orientation B) customer orientation C) production orientation D) strategic marketing orientation
C) production orientation
Which statement below is correct? A quota may _________. A) be only on imports B) not be negotiated as a Voluntary Export Restraints (VER) C) prohibit all trade when it is an embargo D) All of the above
C) prohibit all trade when it is an embargo
The ________ theory seeks to define the relationship between currencies based on relative inflation. A) inflation growth rate B) revaluation C) purchasing power parity D) interest rate
C) purchasing power parity
Individuals should most likely study international business to ________. A) comply with graduate school certification requirements B) ensure that an employer has a global online presence C) remain current on the latest business methods D) obtain bilingual business experience
C) remain current on the latest business methods
A company that makes its marketing program elements uniform, targeting an entire region with similar products, is demonstrating ________. A) customization B) segmentation C) standardization D) differentiation
C) standardization
In the foreign-exchange market, the bid is the rate at which ________. A) the trader is willing to sell foreign exchange B) the buyer is willing to swap foreign exchange C) the trader is willing to buy foreign exchange D) the trader earns a profit
C) the trader is willing to buy foreign exchange
Turnkey projects generally differ from other forms of international business in that ________. A) they tend to be smaller B) customers are more likely private companies C) they are more often located in remote areas D) they depend almost entirely on acquisitions rather than greenfield operations
C) they are more often located in remote areas
Which of the following was the primary purpose of the Organization for Economic Cooperation and Development on Bribery? A) to establish bribery laws B) to quantify global corruption C) to combat global corruption D) to protect corporate bribery whistleblowers
C) to combat global corruption
In the global environment, firms use an international strategy, a localization strategy, a global strategy, or a ________ strategy. A) regional B) standardization C) transnational D) locational
C) transnational
Managers should be more precise in their directions to subordinates when ________. A) the company has a philosophy of geocentrism B) the society believes age equals wisdom C) uncertainty avoidance is high D) power distance is low
C) uncertainty avoidance is high
The value of the SDR is currently based on the ________. A) euro B) U.S. dollar C) weighted average of five currencies D) weighted average of six currencies
C) weighted average of five currencies
Select the correct order, going from low to high total impact on an MNE, of the following types of political risk: (1) procedural political risks, (2) systemic political risks, (3) distributive political risks, (4) catastrophic political risks. A) 3, 2, 1, 4 B) 1, 2, 3, 4 C) 2, 3, 4, 1 D) 2, 1, 3, 4
D) 2, 1, 3, 4
Criticisms of Globalization? A) Threats to national sovereignty B) Environmental stress C) Growing income inequality and personal stress D) All of the above E) None of the above
D) All of the above
Some of the biases that may exist in the context of exchange rate forecasting comprise ______. A) overreaction to unexpected and dramatic news events B) illusory correlation C) overconfidence in one's abilities D) All of the above
D) All of the above
What factor increases globalization? A) Changes in political situations and government policies B) Liberalization of cross-border trade and resource movement C) Growth of consumer pressures D) All of the above
D) All of the above
What factor increases globalization? A) Development of services that support IB B) Expansion of cross-national cooperation C) Rise in and application of technology D) All of the above
D) All of the above
Which of the followings is the main management function of corporate finance? A) To make financial decisions. B) To make investment decisions. C) To manage short-term capital needs. D) All of the above.
D) All of the above.
Which of the followings is NOT an instrument of trade control? A) Import-export tariffs B) Subsidies C) Quotas D) Annual reports
D) Annual reports
________ are among the fastest-growing economic activities in the world. A) Global manufacturing and supply-chain management B) Accounting and taxation C) Finance and human resources D) Exporting and importing
D) Exporting and importing
The central bank in the United States is the ________. A) U.S. Treasury B) U.S. Exchange Reserve C) Board of Governors D) Federal Reserve System
D) Federal Reserve System
Which of the following terms refers to money denominated in the currency of another nation or group of nations? A) Quota B) Foreign subsidy C) Tax exemption D) Foreign exchange
D) Foreign exchange
Which of the following is an advantage of exporting? A) It allows focal firms to attain maximum control by establishing ownership of key assets in the foreign market. B) It is a high-control strategy that requires substantial resource commitment when compared to equity joint ventures. C) It minimizes exposure to tariffs and other trade barriers, as well as fluctuations in exchange rates. D) It increases overall sales volume, improves market share, and reduces per-unit costs of manufacturing and can potentially generate profit margins that are often more favorable than in the domestic market.
D) It increases overall sales volume, improves market share, and reduces per-unit costs of manufacturing and can potentially generate profit margins that are often more favorable than in the domestic market.
Which of the following is a characteristic of totalitarian governments? A) Political dissidents can oppose the government with no repercussions. B) Citizens are guaranteed civil, property, and minority rights. C) The means of production are owned by the people who use them. D) Leaders rule without the explicit approval of the people.
D) Leaders rule without the explicit approval of the people.
Which of the following statements is true. A) Power distance is a measurement of employee preferences of interaction among employees. B) Power distance is a measurement of employee's power. C) Power distance is a measurement of employee's capacity in performing their power. D) Power distance is a measurement of employee preferences of interaction between superiors and subordinates.
D) Power distance is a measurement of employee preferences of interaction between superiors and subordinates.
Cultures in which people focus more on details than on abstract principles are said to be ______. A)Idealism B) Monochronic C)Polychronic D) Pragmatic
D) Pragmatic
Which of the followings is NOT an OTC FX instrument? A) Forward transaction B) Options and currency swaps C) Futures contract D) Sport transaction
D) Sport transaction
An example of a Japanese service export is a visit by a ________. A) Japanese citizen to Disneyland in the United States B) Japanese citizen to the Japan Pavilion at Epcot Center in the United States C) U.S. citizen to the Japan Pavilion at Epcot Center in the United States D) U.S. citizen to Tokyo Disneyland in Japan
D) U.S. citizen to Tokyo Disneyland in Japan
A differentiation strategy works well when ________. A) a company designs a universal product for a broad market B) buyers believe minor product differences are irrelevant to price C) buyers are highly sensitive to price shifts and quality control D) a company can continually develop products that have unique features
D) a company can continually develop products that have unique features
Promotion using direct selling techniques is ________. A) a pull strategy B) necessary where inflation is high C) a standardized advertising technique D) a push strategy
D) a push strategy
Transfer pricing is a strategy that may be used by MNEs to ________. A) reduce consolidated corporate income taxes B) partially finance a subsidiary in another country C) transfer funds from a subsidiary to the parent corporation D) all of the above
D) all of the above
The OECD is concerned about transfer pricing practices because ________. A) transfer pricing can help maximize a company's worldwide tax liability B) transfer prices tend to be higher in industrial than developing countries C) governments use transfer prices to manipulate companies' investment strategies D) companies use transfer prices to manipulate prices and, therefore, taxes
D) companies use transfer prices to manipulate prices and, therefore, taxes
When a country is not able to produce a good more efficiently than other nations, but produces the good more efficiently than it does any other good, it is said to have a(n) ________. A) absolute advantage B) resource advantage C) first-mover advantage D) comparative advantage
D) comparative advantage
Labor cost advantages gained by moving into a country with low wages may be short-lived because ________. A) transport costs go up to cancel out the cost savings B) tax increases cancel out all labor cost differentials C) rivals adopt capital-intensive production methods D) competitors follow leaders into low-wage areas
D) competitors follow leaders into low-wage areas
Which of the following is NOT a general type of importer? A) optimizers B) opportunism C) arbitrageurs D) countertrader
D) countertrader
The stock market is also known as the ________. A) capital market B) foreign-exchange market C) bond market D) equity capital market
D) equity capital market
Citizens of one country who are living and working in another are called ________. A) local employees B) domicile residents C) repatriates D) expatriates
D) expatriates
If a foreign currency is quoted in American terms (the direct quote) and the forward rate for a foreign currency is less than the spot rate, the foreign currency is selling at a ________. A) forward premium B) backward discount C) backward premium D) forward discount
D) forward discount
Which of the following would most likely indicate that a company should handle its own distribution? A) high-volume sales and non-complex after-sales servicing B) local customers and low-tech products C) low sales volume and few business-to-business sales D) global customers and high technology
D) global customers and high technology
Imports can stimulate exports by ________. A) redistributing the work force B) curtailing domestic competition C) generating more tax revenue D) increasing foreign income
D) increasing foreign income
A democratic government institutes personal and political rights, civil liberties, fair and free elections, and _____________. A) personal and common property B) organizational behaviours C) personal issues D) independent courts of law
D) independent courts of law
In conducting ________, a business sells goods directly to or through an independent domestic intermediary in the exporter's home country that exports the products to foreign markets. A) direct exporting B) global marketing C) strategic planning D) indirect exporting
D) indirect exporting
Culture is not ________. A) about beliefs and values of society B) relative C) a collective phenomenon D) inherited
D) inherited
The HRM requirements of a(n) ________ strategy are well matched with an ethnocentric staffing policy. A) localization B) transnational C) global D) international
D) international
A consortium is defined as ________. A) the purchase of an existing company or facility B) two partners forming a new legal entity C) an equity venture to consolidate the value chain D) multiple partners participating on a large-scale project
D) multiple partners participating on a large-scale project
In designing an export plan, managers initially do all of the following EXCEPT ________. A) sequence tactics B) specify objectives C) assess resources D) organize financial support
D) organize financial support
In ________ cultures people are more comfortable working simultaneously on a variety of tasks. In __________ cultures people normally prefer to work sequentially, such as finishing transactions with one customer before dealing with another. A) monochronic; polychronic B) polytechnic; polychronic C) monochronic; homogeneous D) polychronic; monochronic
D) polychronic; monochronic
Offshore financial centers (OFCs) __________. A) are providing only luxury services B) are tax havens C) None of the choice D) provide large amounts of funds in currencies other than their own
D) provide large amounts of funds in currencies other than their own
Which of the following best describes arbitrage? A) using foreign exchange to fund new foreign direct investments B) purchasing foreign currency in anticipation of long-term trends C) using foreign-exchange instruments to speculate for profit D) purchasing foreign currency on one market for immediate resale on another market
D) purchasing foreign currency on one market for immediate resale on another market
Countries most likely establish export restrictions to ________. A) ensure their population obtains the goods first B) reduce domestic production C) encourage substitute products D) raise prices in foreign markets
D) raise prices in foreign markets
The term ________ refers to those people and organizations that are directly affected by the practices and performance of an organization. A) corporate customers B) permanent employees C) community stockholders D) stakeholders
D) stakeholders
Meeting the needs of the present without compromising the ability of future generations to meet their own needs is known as ________. A) the Kyoto Protocol B) externality C) competitive advantage D) sustainability
D) sustainability
An advantage of the geocentric outlook to staffing is ________. A) encouraging workers to appreciate the unique virtues of a particular country B) giving people a flexible perspective for fitting operations to different countries C) removing most behavioral barriers to fully adapting to the chosen local market D) tapping learning opportunities around the world to generate ideas that enhance core competencies
D) tapping learning opportunities around the world to generate ideas that enhance core competencies
In most cases, which type of government protection assistance is most controversial? A) business development services B) foreign business contacts C) trade expositions D) tariffs
D) tariffs
Which of the following is used as an illustration of the PPP theory for estimating exchange rates? A) the Composition of Official Foreign Exchange Reserves (COFER) B) the black market rate C) the import licensing ratio D) the Big Mac Index
D) the Big Mac Index
When a large company and a small company enter a collaborative arrangement, ________. A) the large company is expected to contribute more to the arrangement B) the large company is likely to be more active in the venture C) the small company is more likely to view the collaboration's expansion as competition to itself D) the small company is likely to be disadvantaged if legal action is necessary to solve a dispute
D) the small company is likely to be disadvantaged if legal action is necessary to solve a dispute
A useful way to understanding the purpose of strategy is to think of the firm as a(n) ________, composed of a series of distinct activities, including production, marketing, materials management, R&D, human resources, information systems, and the firm infrastructure. A) activity network B) value constellation C) task succession D) value chain
D) value chain
A multinational enterprise (MNE) is best defined as a firm ________. A) that is a member of the Fortune 500 B) with foreign business partners C) involved in global franchising D) with foreign direct investments
D) with foreign direct investments
The issues that are the foundation of the Ethical Trading Initiative (ETI) include all of the following EXCEPT ________. A) employment is freely chosen B) working conditions are safe and hygienic C) child labor shall not be used D) workers receive hourly wages that are consistent around the world
D) workers receive hourly wages that are consistent around the world
What factor increases globalization? A) Liberalization of cross-border trade and resource movements B) Growing income inequality and personal stress C) Growth in consumer pressures Increase in global competition D) A and B E) A and C
E) A and C
Why do companies engage in international business? a) For defensive reasons b) Resource acquisition c) Sales expansion d) All of the above
d) All of the above