CH 8
Bunyan Heavy Equipment, a U.S. firm, is investigating expanding into Russia using a greenfield venture. The committee researching this project has delivered a negative report. The MAIN concern of the committee is probably:
Russia's recent actions to gain state control of private firm's assets.
In China, Starbucks is standardizing its operations while simultaneously decentralizing some decision-making responsibility to local levels to meet customers' states. Starbucks is following the --- international corporate-level strategy.
Transnational
A global corporate-level strategy differs from a multi-domestic corporate-level strategy in that in a global strategy:
a competitive strategy is dictated by the home office
Firms with core competencies that can be exploited across international markets are able to:
achieve synergies and produce high-quality goods at lower costs.
In conflict in a strategic alliance or joint venture is not manageable, a(n) --- may be a better option.
acquisition
In Porter's model, if a country has both --- and --- production factors, it is likely to serve an industry well by spawning strong home-country competitors that can also be successful global competitors.
advanced; specialized
A licensing agreement:
allows a foreign firm to purchase the rights to manufacture and sell a firm's products within a host country.
Moving into international markets is a particularly attractive strategy to firms whose domestic markets:
are limited in opportunities for growth
Which of the following is NOT a factor pressuring companies for local responsiveness?
availability of low labor costs
When a firm INITIALLY becomes internationally diversified, its returns:
become more variable.
Arkadelphia Polymers, Inc., earns 60 percent of its revenue from exports to Europe and Asia. The CEO of the company would be
concerned if the value of the dollar strengthened.
US companies moving into the international market need to be sensitive to the need for local country or regional responsiveness because of:
consumer needs, political and leal structures, and social norms vary by country.
The transnational strategy is becoming increasingly necessary to compete in international markets for all of the following reasons EXCEPT:
differences in culture and institutional environments also require firms to adapt their products and approaches to local environments.
Internationally diversified firms:
earn greater returns on their innovations through larger or more numerous markets.
A global corporate-level strategy emphasizes:
economies of scale
The location advantages associated with locating facilities in other countries can include all of the following EXCEPT:
evasion of host country governmental regulations
An international diversification strategy is one in which a firm:
expands into potentially large number of geographic locations and markets.
A US manufacturer of adaptive devices for persons with disabilities considering expanding internationally. It is a fairly small company, but it is looking for growth opportunities. This company should primarily consider the option of:
exporting
Raymond Vernon states that the classic rationale for international diversification is to:
extend the product's life cycle
Japan, due to lack of undeveloped and, would be an unusual choice of location for a US cattle company to set up local grazing operations. This limiting factor would be identified in what art of Porter's determinants of national advantage?
factors of production
The benefits of expanding into international markets include each of the following opportunities EXCEPT:
favorable tax concessions and economic incentives by home-country governments
In addition to the four basic dimensions of Porter's "diamond" model, --- may also contribute to the success or failure of firms.
government policy
The means of entry into international markets that offers the greatest control is:
greenfield ventures
The problems associated with exporting include:
high transportation costs and the expense of tariffs.
Which pair of industries would NOT be considered as "related and supporting" under Porter's diamond model?
highway systems and the supply of debt capital
Which of the following is NOT a typical disadvantage of licensing?
incompatibility of the licensing partners.
The increased pressures for global integration of operations have been driven mostly by:
increasing demand for similar products
Which of the following is NOT a disadvantage of international acquisitions?
it is the slowest way to enter a new market.
If intellectual property rights in an emerging economy are not well-protected, the number of firms in the industry is rapidly growing, and the need for global integration is high, ______ is the preferred entry mode.
joint venture or wholly owned subsidiary
A fundamental reason for a country's development of advanced and specialized factors factors of production is often its:
lack of basic resources
A global strategy:
lacks responsiveness to local markets
Most firms enter international markets sequentially, introducing their --- first.
largest and strongest lines of business
Firms able to standardize the process used to produce, sell, distribute, and their service products across country borders enhance their ability to:
learn how to continuously reduce costs while increase the value of their products
The choices that a firm has for entering the international market include all of the following EXCEPT:
leasing
The positive results associated with increasing international diversification have been shown to:
level off and become negative as diversification increases past some point.
--- is the set of costs associated with unfamiliar operating environments; economic, administrative and cultural differences; and the challenges of coordination over distances.
liability of foreignness
The two important environmental trends that influence a firm's choice an and use of international corporate-level strategies are --- and ---.
liability of foreignness; regionalization
US Cola companies entered the global market because of:
limited growth opportunities in their domestic market
A multi-domestic corporate-level strategy has --- need for global integration and --- need for local market responsiveness.
low; high
A global corporate-level strategy assumes:
more standardization of products across country markets.
Working in a multiple international markets can provide firms with --- perhaps even in terms of ---.
new learning opportunities; research and development activities
The four aspects of Porter's model of international competitive advantage include all of the following EXCEPT:
political and economic institutions
Which of the following is NOT a disadvantage associated with exporting?
potential loss of proprietary technologies
Terrorism creates an economic risk for firms, which:
reduces the amount of investment foreign companies will make in a country perceived to be terror-prone
Associations such as the European Union, Organization of American States, and the North American Free Trade Association, encourage:
regional strategies
In France, fine dressmaking and tailoring have been a tradition predating Queen Marie Antoinette. Cloth manufacturers, design schools, craft apprenticeship programs, modeling agencies, and so forth, all exist to supply the clothing industry. This is an example of the ______ in Porter's model.
related and supporting industries
A firm may narrow its focus to a specific region of the world:
so that it can better understand the cultures, legal and social norms, and other factors that are important for effective competition in those markets.
All of the following are reasons why firms use international strategic alliances EXCEPT:
strategic alliances are easy to manage.
International strategy refers to a(n):
strategy through which the firm sells products in markets outside the firm's domestic market.
All of the following are correct about what managers should know about a firms based in a country with a national competitive advantage EXCEPT:
success is guaranteed as the firm implements its chosen international business-level strategy.
Factors of production in Porter's model of international competitive advantage include all of the following EXCEPT:
technology
Disney suffered lawsuits in France at Disneyland Paris as a result of the lack of fit between its transferred personnel policies and the French employees charged to enact them. This is an example of:
the effect of demand conditions.
A multi-domestic corporate-level strategy is one in which:
the firm customized the product for each country in which it competes.
Skaredykat Inc. is considering initial expansion beyond its home market. The firm has decided not to enter markets that differ greatly from its home market, instead expanding within the twelve-nation region that includes its home country.
the firm is using a regional approach
One of the primary reasons for failure of cross-border strategic alliances is:
the incompatibility of the partners
Which of the following is an advantage associated with greenfield ventures?
the level of control over the firm's operations
International corporate-level strategy focuses on:
the scope of operations through both product and geographic diversification.
The decision of what entry mode to use is primarily based on all of the following factors EXCEPT:
the worldwide economic situation.
A large domestic market can provide the country's industries a chance at dominating the world market because:
they have been able to develop economies of scale at home.
Which of the following is NOT and incentive to become multinational?
to avoid high domestic taxation on corporate income
Increasingly, customers worldwide are demanding emphasis on local requirements and companies require efficiency as global competition increases. This has triggered an increase in the number of firms using the --- strategy.
transnational
Effectively implementing the --- international corporate-level strategy often produces higher performance than does implementing either the --- or --- strategies.
transnational; multi-domestic; global
All of the following are international corporate-level strategies EXCEPT the --- strategy.
universal
All of the following complicate the implementation of an international diversification strategy EXCEPT:
widespread multilingualism
