IB Chapter 14
The European Union (EU) requires that the quality of a firm's manufacturing processes and products be certified under a quality standard known as ________ before the firm is allowed access to the EU marketplace.
ISO 9000
Morris Lighting is a US firm that wants to start exporting its high-end lighting fixtures to foreign markets. Morris Lighting should seek assistance from US government agencies for all of the following EXCEPT
acting as an export marketing department or international department for the company
A freight forwarder performs which of the following functions?
arranging the fastest and cheapest transportation of products to and from foreign suppliers
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.
indirect exporting
Fundamentally, countertrade is best described as a(n) _______ transaction.
inefficient
Procter & Gamble exchanges cleaning products for machinery with Russia and Hungary. The nature of this transaction indicates that Procter & Gamble is engaging in
countertrade
According to the research described in your text, which of the following is among the factors that would increase a firm's probability of exporting?
high level of efficiency
The basis for designing an effective export strategy most likely begins with
identifying and developing the firm's core competencies
Which of the following is NOT one of the three main types of importers?
importers looking for suppliers abroad to concentrate their operating risks
Iverson Products is a US firm that is considering expanding internationally by exporting. Which of the following is the LEAST likely benefit for Iverson?
improving economies of scale
The probability that a business is engaged in exporting tends to
increase with the size of the firm
An Australian company makes athletic wear for women, men, and children. After several years of successfully exporting its products to the UK and the US, the company began exporting to Japan. This is an example of
incremental internationalization
The perspective of ________holds that as a company gains experience, resources, and confidence, it progressively increases its scope of countries to which it exports.
incremental internationalization
Small and medium-size enterprises, such as SpinCent as seen in the opening case for chapter 14, account for _______ of all US exporters.
98%
Which of the following best explains why SpinCent decided to export?
growth opportunities in Asia
Refers to any one of several different arrangements that business parties negotiate so that they can trade goods and services with limited or no use of currency.
Countertrade
Which of the following is a difference between export management companies (EMCs) and export trading companies (ETCs)?
ETCs operate more on the basis of demand, while EMCs operate more on the basis of supply.
_____ are among the fastest-growing economic activities in the world.
Exporting and importing
What is the most likely reason that firms avoid aggressively seeking export opportunities?
Firms are reluctant to adjust their established business practices
Strategic alliances with suppliers pioneered to use JIT inventory were started in
Japan by large auto companies such as Toyota
Which of the following is an objective of logisitics?
Manage firm's global supply chain at the lowest cost possible
Barton Accessories has two retail stores and one production facility where the firm's line of leather belts and purses are assembled. Barton employs 430 people and generates nearly $1 million in revenue each year through domestic and international sales. Which term best describes the status of Barton?
SME
Which of the following statements about small and medium-sized enterprises (SMEs) is true?
SMEs make up the majority of all US exporters
Which of the following is true of export trading companies in the United States?
They have been a successful form of export intermediation in recent years.
You are the manager of an SME in the United States, and your firm wants to begin exporting. Since you have never been involved with exporting, there are many compelling reasons that encourage contacting the _________ to obtain expert counseling on exporting.
US Commerce Department
The primary responsibilities of the _______ are the assessment and collection of all duties, taxes, and fees on imported merchandise, the enforcement of customs and related laws, and the administration of certain navigation laws and treaties.
US Customs and Border Protections
Jordan Jewelry is a US firm that designs, manufactures, and sells inexpensive jewelry and accessories. Executives at the firm believe that Jordan Jewelry could significantly increase its profitability by exporting product to foreign markets. Before engaging in international trade, Jordan executives need to develop an export plan. Which of the following questions is LEAST relevant to this activity?
What marketing campaign would be best for Jordan's foreign markets?
Which of the following is NOT an example of a service export?
a coffee chain opening a new store in a foreign country
Vandelay Designs is a small firm based in Boston that makes and sells scrapbooking products through its retail store and Website. Many of Vandelay's first sales were made to customers located in Canada, England, and Japan. Vandelay Designs would best be identified as a(n)
born global
Which of the following is NOT a primary duty of the US Customs and Border Protection?
collecting import and export tariffs
Countertrade is an alternative means of structuring an international sale when
conventional forms of payments are difficult, costly, or nonexistent
All of the following are benefits of countertrade EXCEPT
decreasing trade protectionism
An exporter that implements a(n) _________ strategy does so with the intent to develop its own international marketing capability.
direct exporting
As described in the opening case, SpinCent's CEO analyzed foreign markets, assessed industries, prepped his company, traveled overseas, and hired trustworthy distributors. SpinCent manages the export process including making and marketing its products for foreign buyers. The nature of these activities shows that the leadership of SpinCent is committing the company to
direct exporting
Which of the following has been the LEAST likely outcome of e-commerce on exporting?
enhancing supply chains
The _________ of a firm is the share of its total output that is exported.
export intensity
A(n) ___________ operates on a contractual basis and provides exclusive representation for an exporter's goods and services in a foreign market.
export management company
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?
exporting
Corbin Coffee plans to initiate activities in foreign markets through indirect exporting. The firm is most likely to use ________.
external specialists to assist in the export process
All of the following are common problems associated with exporting and importing EXCEPT
finding reliable intermediaries
Which of the following is NOT one of the three common ways that private trade intermediaries are paid by exporters?
fixed salary
The benefits of retaining a core competency within a company and purposefully threading that core competency through the value chain are referred to as ________ advantages
internalization
Which of the following is typically true of an export management company?
it operates on a contractual basis for a manufacturer by helping obtain orders for its client' products.
There is an increasing trend among many US companies to outsource customer care services to places such as India because _______ in those countries.
labor costs are lower
A driving factor for the growth in imports is the impact of
labor specialization
Which of the following BEST describes the concept of serendipity in exporting?
opportunistically responding to unsolicited orders from foreign customers
In designing an export plan, managers initially do all of the following EXCEPT
organize financial support
The CEO of Coffman Enterprises wants to export products to foreign markets. However, top executives at Coffman are concerned that the firm will face fierce competition from foreign rivals because Coffman lacks significant core competencies. The executives are most likely worried that Coffman lacks
ownership advantages
Federal, state, and local governments that recognize the benefits of international trade, actively aid the efforts of potential and active exporters and
protect the interests of struggling importers
The Internet supports more companies' efforts to launch a direct exporting strategy by
providing information quickly and inexpensively
Ultimately, countertrade is an inefficient way of doing business because it
requires buyers and sellers to negotiate a fair value on the exchange
This spring break you are planning to leave the United States and visit London, where you will stay in a hotel for 10 days. The London hotel will be performing a(n)
service export
The incremental internationalization view of exporting holds that companies first target countries that are ______ their home market.
similar to
Boyce Dynamics, a US maker of LED flashlights, fills unsolicited orders from foreign buyers. It has not proactively investigated international trade options. Boyce Dynamics is best categorized as a
sporadic exporter
What is typically the most difficult aspect of an export plan for SMEs?
targeting the right foreign market
Which of the following types of agents moves international cargo, facilitates shipment tracking, and handles product returns for exporters and importers?
third party logistics
Technological factors are making it feasible, and necessary, for firms to concentrate manufacturing facilities at optimal locations around the world. However, ______ and _______ are major brakes (disadvantages) on this trend.
trade barriers; transportation costs
A customs broker or other import consultant can help an importer minimize import duties by
valuing products in such a way that they qualify for more favorable duty treatment
Companies are likely to export products abroad in all of the following situations EXCEPT
when they want to use the riskiest but most profitable method to engage international trade
