MGMT 128: Final Study Guide

Advantages of the virtual corporation concept include that it allows a company to build competence from the ground up and to increase management's control over the corporation's activities. a) True b) False

False

An expatriate is a person living outside his or her country of birth. a) True b) False

False

Companies rely on a mission statement to determine where it is going in the future, how it will get there, and whether or not goals are achieved. a) True b) False

False

Gift giving across cultures is viewed as a simple kindness and not a reflection of intent. a) True b) False

False

Which of the environments associated with a company refers to the uncontrollable forces originating outside the home country? a) National b) Domestic c) International d) Foreign

Foreign

Big Tire Bikes Inc. is headquartered in Maryland and does business within the United States, as well as within many countries in Europe and South America. This company is an example of a(n) a) international affiliate. b) international business. c) domestic corporation. d) foreign subsidy.

international business.

What is one of the reasons suggested by Alfred Marshall for why firms tend to cluster together on a geographic basis? a) Technological information can be readily shared. b) Efficiency improves as the result of cumulative experience. c) Competition will not enter the market. d) Production costs decline as facilities get larger.

Technological information can be readily shared.

What is a characteristic of a traditional strategic planning approach? a) The CEO and the head of planning get together to devise a corporate plan, which is then handed to the operating people for execution. b) Interaction with important customers and suppliers is included. c) Governments and other stakeholder activities are direct participants. d) There is a strong and effective responsiveness to differences that occur in local markets.

The CEO and the head of planning get together to devise a corporate plan, which is then handed to the operating people for execution.

Trompenaars's achievement versus ascription dimension describes social status based on what one does or who one is. In the United States, where people build who they are through work, social status tends to be a) based on achievement. b) based on ascription. c) a subtle form of prejudice. d) ignored because the United States does not have classes.

based on achievement.

What is one argument in support of globalization? a) Globalization enhances access to health care for participants. b) Free trade enhances socioeconomic development. c) The process of globalization has enhanced the equalization of countries in terms of political and social economy. d) Environmental issues are lessened through globalization.

Free trade enhances socioeconomic development.

Culture frameworks are helpful, but their use may a) result in too much empathy for a different culture. b) oversimplify and limit our understanding and learning after a point. c) give too much emphasis on culture. d) lead to further frameworks and further complication.

oversimplify and limit our understanding and learning after a point.

Lexon Corp. produces high-nutrition breakfast products. As it enters into foreign markets, it faces strong pressures for both reducing costs and adapting products for local markets. Based on this, the company should use a a) global strategy. b) multidomestic strategy. c) transnational strategy. d) home replication strategy.

transnational strategy.

A description of the company's desired future position if it can acquire the necessary competencies and successfully implement its strategy is known as a a) strategic plan. b) mission statement. c) vision statement. d) values statement.

vision statement.

Technological information can be readily shared. a) $8.7 trillion. b) $3.4 billion. c) $19.2 trillion. d) $30.8 trillion.

$30.8 trillion.

The volume of international trade in services exports in 2017, worldwide, was a) $8.5 trillion. b) $18.8 trillion. c) $5.4 trillion. d) $12.3 trillion.

$5.4 trillion.

In the Steers & Osland textbook a question is asked: "Can organizations today be managed in the same way they were in the past"? One way it seeks to address this question is by postulating a "global" perspective. Which, if any, of the following aspects of the workplace should be considered in that global persective? a) Managerial environment b) Situational coningencies c) Organizational environment d) Cultural environment e) All of the above

All of the above

Which, if any, of the following are key stakeholders for a typical business organization? a) Social Activists and NGOs b) Employees Union c) Banks and other lenders d) All of the above e) None of the above

All of the above

In the Podcast "Making Sense" found in Hub 3, which, if any, of the following levels were identified? a) All of the above. b) A level that is asynchronous and the firm begins to think globally, passing the baton to people around the world. c) A level where a firm is not acclimated to working in a remote environment. d) None of the above. e) A level where the firm recreated online capabilities but in the office.

All of the above.

In the article "Society 3.0: Using technology to improve public goods", Vodafone Group CEO Vittorio Colao discusses why technology should not merely increase productivity but also benefit socieity at large. Which, if any, of the following best identify his concern(s)? a) Social entrepeneurs, business and government should collaborate more. b) Public health, and public hospitals are very important thanks to "taxes". c) None of the above. d) All of the above.

All of the above.

What is one disadvantage of the geographic region structure? a) All managers report to their respective home or host country office. b) It is not appropriate for companies that produce items with low technological content. c) Each region must have its own product and functional specialists. d) It complicates the task of directing worldwide operations.

Each region must have its own product and functional specialists.

If Ecuador has an absolute advantage in coffee and Argentina in wheat, then, according to trade theory a) Argentina should focus on producing coffee and trade for wheat. b) Ecuador would do well to produce its own wheat rather than import it from Bolivia. c) Ecuador should focus production on coffee and trade for other goods. d) there will be a perfect trade balance between the two countries.

Ecuador should focus production on coffee and trade for other goods.

How are exchange rates used in international trade? a) Exchange rates indicate which products create an absolute advantage for trading partners. b) Exchange rates are used to devalue property in exchange for goods. c) Exchange rates are used to convert from foreign to domestic currency. d) Exchange rates set the costs of labor.

Exchange rates are used to convert from foreign to domestic currency.

What method do companies often use when initially entering a foreign market? This method would create the least amount of risk. a) Export product to the foreign market. b) Acquire an existing business in the foreign market. c) Create a wholly owned subsidiary. d) Build a manufacturing facility in foreign market.

Export product to the foreign market.

The monopolistic advantage theory states that a) the firm making the overseas investment first has a monopolistic advantage. b) FDI is made by firms in oligopolistic industries possessing technical advantages over local companies. c) a firm that has a monopoly has a major advantage in overseas investment. d) a firm that has a monopoly domestically will have no competition making overseas investments.

FDI is made by firms in oligopolistic industries possessing technical advantages over local companies.

Hofstede is primarily concerned with social values and the dimensions he identified that help parents understand their children. a) True b) False

False

Kirin Brewery kaisha belongs to the Fujimoto keiretsu. a) True b) False

False

Lobbyists who advocate for new laws that will affect the production standards of a business are an example of an internal force. a) True b) False

False

Most managers prefer objectives that are qualified but not quantified. a) True b) False

False

Of all the promotional mix elements, personal selling has the greatest similarities worldwide. a) True b) False

False

Portfolio investment is the purchase of sufficient stock in a firm to obtain significant management control. a) True b) False

False

Procedures are broad guidelines issued by upper management for the purpose of assisting lower-level managers in handling nonrecurring problems. a) True b) False

False

Repetition of the bottom-up or top-down planning process until all differences are reconciled is called sequential planning. a) True b) False

False

Scenarios are forecasts that extrapolate from past data to make predictions. a) True b) False

False

Since all cultures have the same attitude toward authority, the role of the manager is comparable across cultures and is not a matter of concern for human resources. a) True b) False

False

The domestic environment includes all the controllable forces originating in the home country that surround and influence the life and development of the firm. a) True b) False

False

The dynamic capability theory states that for a firm to invest overseas, it must have three kinds of advantages: ownership specific, internalization, and location specific. a) True b) False

False

The international environment refers to all the uncontrollable forces originating outside the home country that surround and influence the firm. a) True b) False

False

The issue of "culture shock" may be described as "individuals living between two cultures". Namely, the culture of orgin and the ability of the host country to adapt to that individual. a) True b) False

False

The proportion of the outstanding stock of foreign direct investment accounted for by the United States declined by two-thirds over the past 20 years. a) True b) False

False

The ultimate managers of strategic planning and strategy making for a company are the members of the executive board. a) True b) False

False

Transnational corporations consist of several entities each of which has its own independent strategy and policies. a) True b) False

False

When adjusting to other cultures, the first step managers can take is to compare their current culture to another to assess its value. a) True b) False

False

What is the second stage in the international product life cycle theory? a) Foreign competition appears in export markets. b) Import competition appears in the United States. c) The United States innovates and exports. d) Foreign production begins.

Foreign production begins.

Proponents of the horizontal corporation would say that this approach a) increases lateral relationships that inhibit innovation and new-product development. b) places more decision-making responsibility in the hands of middle managers and other skilled professionals. c) enhances increased control and supervision by upper management. d) enhances efficiency by increasing the use of vertical decision processes.

places more decision-making responsibility in the hands of middle managers and other skilled professionals.

Honest Yogurt Company of Denver, Colorado, was relieved when trade barriers on dairy products were lifted in Europe and the company could sell its products there. Which type of driver was affecting the company's ability to do business in Europe? a) political b) market c) technological d) social

political

When a government sees that local industry is threatened by imports, it can threaten to erect import barriers to stop or reduce these imports. This is an example of a ________ driver of international business activity. a) market b) political c) cost d) technological

political

The staffing policy at Super Food International is based on the specific local context in which the company's subsidiaries operate. What type of staffing policy does this reflect? a) ethnocentric b) polycentric c) regiocentric d) geocentric

polycentric

Holly is a multitasker and prefers to work on more than one project at a time at work. Edward Hall would say that Holly favors which approach to time? a) mnemonic b) ionic c) monochronic d) polychronic

polychronic

Jay-yeong is the finance director of a firm in Seattle. He often attends meetings for work and it is not uncommon for these meetings to overlap one another so he is finishing up with one while he should be at another. Trompenaars would say that Jay-yeong works at a company that reflects what dimension of time? a) ethnocentric b) theocentric c) monochronic d) polychronic

polychronic

An example of political drivers of globalization would be a) globalizing product lines to decrease costs of production. b) the introduction of competitor firms. c) increased communication created by advanced communication technologies. d) privatization of industries.

privatization of industries.

According to culture expert Edgar Schein several characteristics in the work environment collectively create an organization´s unique culture. These include which, if any, of the following? a) problem-solving processes b) Symbols and behaviors c) Power distribution d) Only A & B

problem-solving processes

Most strategic business units are organized based on a) geographic region. b) functional area. c) customer class. d) product line.

product line.

Scenarios allow a business to a) project possible outcomes of business decisions. b) extrapolate from past data to make predictions. c) create a company's vision statement. d) analyze competitor actions and functions.

project possible outcomes of business decisions.

To develop a strategy for reaching corporate objectives, management must first try to a) select a viable market segment. b) quantify them. c) define the firm's mission. d) develop scenarios.

quantify them.

Which of the elements in Porter's diamond model of national advantage takes into consideration companies that locate near the suppliers they need to produce their product? a) demand conditions b) related and supporting industries c) firm strategy, structure, and rivalry d) factor conditions

related and supporting industries

Historically, international business as a business practice is considered a) relatively new. b) to have existed before the Roman Empire. c) a result of the rise of the Ottoman Empire. d) to have begun in China.

relatively new.

Theory based on ________ states that international and interregional differences in production costs occur because of differences in the supply of production factors. a) absolute advantage b) resource endowments c) comparative advantage d) mercantilist advantage

resource endowments

In high-context cultures, direct conversations that "tell it like it is" would be viewed as a) humorous. b) rude. c) appropriate. d) expected.

rude.

Kenneth thought the company should promote the new product in foreign markets by having a contest in which the winner would receive a one-year supply of the product. Which type of advertising strategy is Kenneth suggesting? a) sales promotion b) pop-up ads c) personal selling d) public relations

sales promotion

How is the headquarters of an IC affected in a joint venture? a) Headquarters has more control over activities in a joint venture. b) The ability to take action in a joint venture is similar to that of a wholly owned subsidiary. c) Headquarters does not enjoy as much freedom of action in a joint venture. d) In a joint venture, the headquarters of a company is not included in decision making activities.

Headquarters does not enjoy as much freedom of action in a joint venture.

In the Steers & Olsland textbook describes various stages of phsychological adaptation to a new culture by which, if any, of the following? a) Honeymoon, Disintergration, Independence and Autonomy b) Unrealistic expectations and personal characteristics c) Initial adaptation issues. d) Honeymoon, Disillusionment, Adaptation and Biculturalism

Honeymoon, Disillusionment, Adaptation and Biculturalism

What is a characteristic of a horizontal corporation? a) It often draws teams from different departments to solve a problem or deliver a product. b) It puts greater decision-making responsibility in the hands of managers from outside the company. c) It is considered the most conventional organizational structure. d) It is the same as a "virtual organization."

It often draws teams from different departments to solve a problem or deliver a product.

What is a disadvantage of top-down planning? a) It restricts initiative at lower levels of the organization. b) It is highly sensitive to differences in local conditions. c) It reduces the need for consultation, especially in an international company. d) It has corporate headquarters develop and provide guidelines.

It restricts initiative at lower levels of the organization.

What is a characteristic of a geocentric staffing policy? a) It enables the practices used at headquarters to be transferred worldwide. b) It only hires regional employees to fill positions in the host country. c) It selects the best person for each job, without considering national origin. d) It involves human resources policies that are created at the local level for the specific context in which the local operations operate.

It selects the best person for each job, without considering national origin.

While there may be valid reasons for decisions to always be made at an ICs headquarters, why is it important for some decisions to be delegated to the subsidiary? a) Managers at the subsidiary must have all decisions approved by the parent company. b) Managers at the subsidiary may become hostile and disloyal. c) The subsidiary has more local knowledge. d) The subsidiary is typically on a lower pay scale.

Managers at the subsidiary may become hostile and disloyal.

If a company is able to standardize the marketing mix globally, how does it affect economies of scale? a) The company can take advantage of economies of scale based on longer production runs and lower manufacturing costs. b) The company misses out on economies of scale because it is customizing products for individual markets. c) The company only reaches economies of scale if it returns to the domestic market. d) The company will enjoy economies of scale for the initial introduction of a product but then lose those economies once a product matures.

The company can take advantage of economies of scale based on longer production runs and lower manufacturing costs.

Why does McDonald's use the color hunter green as the background for its golden arches logo in Europe when it uses red in the United States? a) The color red symbolizes war. b) Green is used by several competitors in the same market. c) The green is viewed as eco-friendly. d) Red is equated with the lower class.

The green is viewed as eco-friendly.

What is an example of an external force that can affect a company's environment? a) The manufacturing plant purchases new equipment to automate a process. b)The marketing department decides that online advertising will work best for a new product introduction. c) The newly-elected governor decides to raise property taxes. d) A human resource professional meets with staff to discuss hiring temporary help.

The newly-elected governor decides to raise property taxes.

Mexico and Canada are major U.S. trading partners because they have the benefit of lower freight charges and shorter delivery times. Why do these benefits exist for these two nations? a) They source production materials from China. b) They established these parameters in the NAFTA agreement. c) They share a border with the United States. d) They have established economies of scale for goods and services.

They share a border with the United States.

The World Economic Forum's annual Global Gender Gap Report found that women´s talents are underutilzed at work and women are frequently paid less than their maile counterparts. Although such pay gaps are declining, the report estimates that it would take decades before women and men are paid equally. This is a result of which, if any, of the following? a) Corporate leadership is to blame. A good corporate leader should be able to correct this gap. b) The concept of equal rights is best addressed at the national level, rather than at the organizational level, to the extent that a corporation reflects societal interests in general. c) To some extent, societal and corporate practices regarding equal rights are embedded in core beliefs and values. d) The report was disproven as "fake new".

To some extent, societal and corporate practices regarding equal rights are embedded in core beliefs and values.

A cost-of-living allowance provides an expat with money that would cover price differences in food, transportation, clothing, and medical expenses. a) True b) False

True

According to the Harvard Business Review article: The New Era of Globalization Will Be Shaped by Customers, Tcchnology, and Value Chains: "If you ask the average CEO what's making them lose sleep these days, it's a good bet that the answer will be tariffs and trade wars." a) True b) False

True

According to the Technology lecture in Hub 3, "Technology" is a sort of knowledge or skill used for employing and controliling factors fo prodcution that, in turrn could lead to the outp ut of products and services. a) True b) False

True

Consumer products that are "trendy" or based on a fad, generally require greater adaptation to local markets. a) True b) False

True

From the Steers and Osland textbook, we have learned three general strategies can be identified for improving our ability to work with organzations across the globe. These strategies include working to understand interrelationships between stakeholders, strategies, and structures across cultures; learning more about the dynamic process within a organizations; and building greater multicultural and global manangement skills. a) True b) False

True

Hofstede's pragmatic versus normative dimension reflects an assessment of how individuals handle unexplainable aspects of their lives. a) True b) False

True

In the Japanese keiretsu model of orgainaztion, hierarchy, strong collectivism, strong harmony orientation, moderate monochronism, and strong particularism appear to be prevelant. a) True b) False

True

In the Podcast "Making Sense" found in Hub 3 specific reference was made to 5 distinct levels of virtual corporate operations. One of them, was described as "Nirvana" where you design your working environment to your well being. a) True b) False

True

In the Steers & Osland textbook the question is asked: "Why do people work?", according to them, the question lies at the heart of the topic of personal work values. a) True b) False

True

International business differs from domestic business in that a firm operating across borders must deal with the forces of three kinds of environments—domestic, foreign, and international. a) True b) False

True

International markets often differ widely because of great variations in the uncontrollable environmental forces. a) True b) False

True

Once a person has grown accustomed to a new culture, returning to one's home culture can produce an experience of reverse culture shock. a) True b) False

True

One way a company uses sales promotion is by providing point-of-purchase displays to retail stores. a) True b) False

True

The disadvantages of using employees from the home or host countries can sometimes be avoided by sending third-country nationals to fill management posts. a) True b) False

True

The first formulation of international trade theory, by Adam Smith, was motivated by political considerations. a) True b) False

True

The international product life-cycle theory may have its greatest usefulness in explaining trade and investment behavior when international firms introduce their new products in home markets first. a) True b) False

True

The less familiar the home company is with cultural values in a host country, the more likely the home company will rely on the subsidiary for management. a) True b) False

True

The vast proportion of outward FDI, about two-thirds, originates from the developed countries. a) True b) False

True

The United States can produce more wheat for the same or lower costs than many other countries. This is an example of a) mercantilism. b) economies of scale. c) absolute advantage. d) a trade surplus.

absolute advantage.

The capability of one nation to produce more of a good or service than another country for the same or lower cost of inputs is a(n) a) comparative advantage. b) mercantilist advantage. c) trade surplus. d) absolute advantage.

absolute advantage.

Multiple, plausible stories that managers consider for what might happen in the future are known as a) vision statements. b) contingency plans. c) scenarios. d) strategies.

scenarios.

Foreign subsidiaries must obey the local laws. If they don't, they could be subject to a) reciprocal behavior by competitor companies. b) seizure by the host government. c) legal action by the United Nations. d) legal action by the country of the parent company.

seizure by the host government.

Which aspect of strategic planning helps a company maintain itself within the boundaries of the mission and vision statements? a) analyzing the internal environment b) implementing tactical plans c) setting corporate objectives d) analyzing the external environment

setting corporate objectives

According to the theory of comparative advantage, a nation a) should produce the goods for which its absolute disadvantage is less. b) should strive to produce trade surpluses to acquire supplies of precious metals. c) can gain from trade if it is equally inefficient in producing two goods. d) must have an absolute advantage in at least one good to gain from trade.

should produce the goods for which its absolute disadvantage is less.

Signature Appliance Group decided to remove the grill unit from the ovens it sells in South America after customers complained they preferred to grill outside and would never use this feature. Which environmental force caused the company to change its product? a) legal b) sociocultural c) economic d) physical

sociocultural

When Maddie got to her manager's office, she noticed the door was closed and decided the manager was busy so she should come back later. What aspect of culture is affecting her decision to return later? a) spatial relationships b) performance issues c) conversational distance d) ethnocentric values

spatial relationships

Jamie prefers to keep her work life and home life separate. She doesn't socialize with her work associates after-hours and doesn't discuss her family when she is at work. Which of Trompenaars's dimensions does this exemplify? a) individualism vs. collectivism b) specific vs. diffuse c) universalism vs. particularism d) achievement vs. ascription

specific vs. diffuse

One challenge presented to employers by the rural to urban migration is a) educating the rural immigrants in etiquette associated with city life. b) supporting the social and psychological adjustment necessary for rural immigrants in an urban work setting. c) maintaining the rural immigrant's interest in work. d) fully utilizing the new pool of highly skilled immigrant workers.

supporting the social and psychological adjustment necessary for rural immigrants in an urban work setting.

Hofstede's power distance dimension can be described as a) the expectation that power will be equally distributed amongst members of society. b) the expectation by individuals that uncertainty is possible. c) the expectation that uncertainty will be kept at a distance from society. d) the extent to which society expects power to be distributed unequally.

the extent to which society expects power to be distributed unequally.

The term globalization was first coined in a Harvard Business Review article in which the author maintained that a) increased differentiation of products would mean that costs of production would become a steadily declining proportion of the selling price. b) the future belonged to global companies that sold the same things the same way, everywhere. c) governments would be threatened by the emergence of global companies and would limit their development. d) new technologies were creating opportunities for creating mass customization of products.

the future belonged to global companies that sold the same things the same way, everywhere.

The management team met to discuss the best way to promote, price, and distribute the new product. What is the management team working on? a) personal selling b) the marketing mix c) financial analysis d) sociocultural forces

the marketing mix

Sorrell Agri Products needs to determine how it will promote the new product, how much it will cost, and where it will be distributed. In other words, the company is making decisions about a) the marketing mix. b) the corporate visual identity. c) the vision statement. d) standardization versus customization.

the marketing mix.

A local labor market is made up of a) the entire population of people in the local operating area. b) a country's pool of people with the required skill set. c) the pool of available employees with the necessary skills and who are within commuting distance. d) the pool of employees with the necessary skills who are in the country or surrounding nations.

the pool of available employees with the necessary skills and who are within commuting distance.

Headquarters is more likely to rely on subsidiary management if: a) subsidiary managers are from another country. b) conditions in the host country are very similar to those in the home country. c) the subsidiary is located far away from headquarters. d) the host country has similar institutions and politics to those in the home country.

the subsidiary is located far away from headquarters.

After college, Thomas moved from California to take a job overseas. He was surprised to find that the city he moved to had strict curfew laws and all the shops and restaurants closed by 10 pm. The culture he moved into seems to want to minimize unpredictable situations which reflects which of Hofstede's dimensions? a) individualism-collectivism b) masculinity-femininity c) power distance d) uncertainty avoidance

uncertainty avoidance

The marketing team decided to develop two promotional campaigns: one featuring slender models and the other using curvier models to address the cultural differences of their audience. With what aspect of culture is the marketing team concerned? a) artifacts b) verbal communication c) aesthetics d) gift-giving

aesthetics

In designing the organizational structure, management knows that two concerns, __________ and __________, run counter to each other. a) an effective way to departmentalize; coordinating activities b) earning profits; paying taxes c) hiring employees; gauging client groups d) sales growth; research and design expenditures

an effective way to departmentalize; coordinating activities

An industry that has a limited number of competing firms, such as the U.S. mobile phone market in which four firms controlled 98 percent of the market in 2018, is known as a) perfect competition. b) a monopoly. c) an oligopolistic industry. d) deregulated.

an oligopolistic industry.

During the strategic planning discussion, committee members reviewed the current systems in place in the company's manufacturing plant to determine if it could handle the anticipated increased capacity should the company go through with the foreign investment. Which step in the strategic planning process does this reflect? a) quantify goals b) analyze the company's internal environment c) define the company's business and mission d) set corporate objectives

analyze the company's internal environment

Regarding a sustainable competitive advantage, the company must have skills or competencies that a) reflect the lowest price possible. b) are easily replicated. c) are difficult to imitate or substitute for. d) can be copyrighted or patented.

are difficult to imitate or substitute for.

Ferguson Furniture group has adopted an ethnocentric staffing policy. Based on this, where are most of the decisions made for the home and host country facilities? a) at both the home and host country facilities depending on which is being affected by the decision b) at a third-country national in order to promote collective bargaining c) at the host country facility in order to accommodate for local customs. d) at the company's headquarters, using the home country's frame of reference

at the company's headquarters, using the home country's frame of reference

For cost-of-living allowances, the U.S. Department of State index is a) considered suitable for all locations. b) adjusted frequently. c) based on costs in Washington, D.C. d) equated to currency value changes.

based on costs in Washington, D.C.

The major motivation for immigration is a a) better economic situation. b) more stimulating environment. c) safer, more secure environment. d) chance to leave urban areas for a rural lifestyle.

better economic situation.

Developing nations are greatly concerned when highly-skilled professionals such as scientists, IT specialists, teachers, and health care professionals leave the country to seek better living arrangements. What term is given to this type of emigration? a) self-fulfilling prophecy b) ethnocentrism c) groupthink d) brain drain

brain drain

What is an example of a physical force that can affect standardization of a product? a) safety standards b) income disparity c) language d) climate

climate

The automobile manufacturer decided it had to enter the European market because if it didn't, then all of the other car companies that were already there would get the business. Which driver is indicating internationalization for the manufacturer? a) market b) cost c) political d) competitive

competitive

The evolution of the combination supermarket-discount store in Europe suggests that a) consumers are demanding more variety in products. b) people everywhere want the suburban lifestyle. c) people still enjoy shopping. d) daily shopping around the world will soon be over.

consumers are demanding more variety in products.

According to Trompenaars, a culture's attitude toward the environment can range from a) overwhelmed by aesthetics to dominating the environment. b) control over the environment to harmony with it. c) submission to atheism. d) peaceful to war-like.

control over the environment to harmony with it.

Environment as used in the textbook involves the forces surrounding and influencing the life and development of the firm and is classified as a) primary and secondary. b) domestic and foreign. c) representative and democratic. d) controllable and uncontrollable.

controllable and uncontrollable.

When Corinne was introduced to the manager from the overseas office, she noticed he tended to lean in as he spoke with her. This made her uncomfortable, so she did her best to put some space between them during the meeting. What is causing Corinne to feel uncomfortable? a) polychronic time constraints b) material artifacts c) conversational distance d) aesthetics

conversational distance

A business that decides to increase sales by entering the international market may do so in order to create economy of scale. This would be an example of which driver of internationalization? a) political b) competitive c) market d) cost

cost

Unconscious reference to one's own cultural values when judging behavioral actions of others in a new and different environment is called the self-reference a) values. b) culture. c) criterion. d) customs.

criterion.

The need to change the color of packaging when selling a product in a new market is generally a result of the influence of a) distributive forces. b) competitive forces. c) political conflicts. d) cultural differences.

cultural differences.

The anxiety that people often experience when they move from a familiar culture to one that is entirely different is known as a) self-fulfilling prophecy. b) culture shock. c) brain drain. d) expatriate syndrome.

culture shock.

To set corporate objectives, management must first a) select a viable market segment. b) quantify them. c) define the firm's mission. d) research the market.

define the firm's mission.

A major portion of the exports from developing countries go to ________ countries, and this proportion has been ________. a) developing; increasing b) developing; decreasing c) developed; decreasing d) developed; increasing

developed; decreasing

When considering international advertising efforts, a company that adopts a "glocal" approach is a) focusing on a localized campaign. b) more concerned with other elements of the marketing mix than promotion. c) using more global campaigns than local ones. d) developing a cost-effective common strategy for large regions.

developing a cost-effective common strategy for large regions.

The executives from the Japanese company did not like the advertisement created by the U.S. agency. The executives said that telling the consumers about the benefits of the product was too pushy and would be viewed as arrogant. Which cultural dimension are the executives concerned with? a) directness b) comparison c) gender roles d) sophistication

directness

The theory that for a firm to successfully invest overseas, it must have not only ownership of unique knowledge or resources, but also the ability to dynamically create, sustain, and exploit these capabilities over time, is known as a) internationalization theory. b) dynamic capabilities theory. c) strategic behavior theory. d) internalization theory.

dynamic capabilities theory.

When gross national income rates drop significantly, it affects a company's environment. Which type of external force does this represent? a) physical b) legal c) economic d) technological

economic

The tendency toward an international integration of goods, technology, information, labor, and capital, or the process of making this integration happen, is called a) internationalization. b) multinationalization. c) international business. d) economic globalization.

economic globalization.

Five years ago it cost Bernie's Bikes Inc. about $52 dollars to build a single bike. Today, it only costs the company about $31 because they have automated the process and are able to purchase component parts in larger quantities. What allowed the company to reduce the price to build a bike? a) economies of scale b) trade deficit c) product differentiation d) trade surplus

economies of scale

One reason manufacturers are using global advertising is because identical products are easier to make which allows the company to take advantage of a) competitive advantage. b) customization of regional products. c) the industrial goods market. d) economies of scale.

economies of scale.

As their overseas operations have increased in importance, larger multinationals have felt the need to a) change from a global structure to an international division. b) establish home country operations that handle all aspects of production and marketing. c) eliminate their domestic operations. d) establish worldwide organizations based on product, customer class, function, or region at the top level.

establish worldwide organizations based on product, customer class, function, or region at the top level.

Companies in which there is little pressure to reduce costs or adjust for local responsiveness and where most decisions are made using the home country's frame of reference have adopted which type of staffing policy? a) ethnocentric b) polycentric c) regiocentric d) geocentric

ethnocentric

The international product life cycle is used to a) explain how international trade in manufactured goods will be linked to gross national income. b) show that a nation will trade goods that can be produced with the production factor that is most abundant. c) explain the role of innovation in trade patterns. d) explain why mercantilism failed.

explain how international trade in manufactured goods will be linked to gross national income.

In a low power distance culture, a) seniority, rank, and title are important. b) relatives will be welcomed into the workforce. c) people will want direction, so top-down leadership styles are appropriate. d) first names are likely to be used in the office because the ideal is equality.

first names are likely to be used in the office because the ideal is equality.

Kendrik decided not to take the overseas position because he knew managers worked alongside their staff and did not have private offices in this particular international culture. He thought this made managers look less important and inconsequential. What aspect of culture is he concerned with? a) unspoken language b) folklore c) aesthetics d) verbal communication

unspoken language

For expatriate employees, the salary portion of the compensation package is a) usually higher than employees at the same level in the home company. b) usually lower than employees at the same level in the home company. c) usually within the range of the employees at the same level in the home company. d) usually on a separate, expatriate schedule.

usually within the range of the employees at the same level in the home company.

According to Porter, the four variables he believes influence a firm's ability to gain a competitive advantage create a a) consistent triangle. b) virtuous circle. c) reliable square. d) redundant cone.

virtuous circle.

Stanton Construction Corporation was recently acquired by another company. With this merger, the newly formed company created a description of the businesses' desired future position. What type of statement did it create? a) values statement b) vision statement c) strategic statement d) mission statement

vision statement

Companies should keep in mind that planning for an expat's return should start a) when the expat announces they want to return home. b) within six months of the return date. c) well before the assignment even begins. d) on the first day of the expat assignment.

well before the assignment even begins.

Real Country Boots was surprised when its marketing campaign featuring a cowboy fell flat in some South American countries but prospered in the United States. They later determined that a cowboy was considered "just another job" in parts of South America so it held little appeal to consumers. In this instance, the company used what aspect of aesthetics incorrectly? a) nonverbal communication b) folklore c) gift-giving d) art

folklore

While assessing the structure of the proposed international company, the management team asked for reports on the terrain of the country where they planned to build a new plant. This report would be used to forecast the costs of building which would vary significantly if the terrain was mountainous. Which of the four elements of designing the structure of an IC does this represent? a) customer expertise b) geographic expertise c) functional expertise d) product and technical expertise

geographic expertise

Generally, as marketers go down the economic and social strata in each country, they will tend to find a) greater similarities among countries in social and cultural values. b) greater dissimilarities among countries in social and cultural values. c) no significant differences in social and cultural values. d) greater government support and thus disposable income for each succeeding lower stratum.

greater dissimilarities among countries in social and cultural values.

The use of an international product structure typically a) represents a sharp move away from pre-export department times. b) removes domestic product divisions. c) helps to avoid duplication of product experts. d) suffers from a duplication of area experts.

helps to avoid duplication of product experts.

Understanding a person's body language and facial expressions would be especially important during business conversations in which type of culture? a) low context b) high context c) polychronic d) monochronic

high context

The domestic environment is composed of all the uncontrollable forces originating in the ________ that surround and influence the life and development of the firm. a) foreign country b) home country c) host nation d) international arena

home country

A drawback of ethnocentric staffing policies is that a) it is less expensive to use employees from the home country. b) there are no additional expenses associated with relocating these employees and their families. c) home-country employees may not have experience with the language and culture of the host country. d) they expand the experience base of home-country employees.

home-country employees may not have experience with the language and culture of the host country.

Which type of company is characterized by lateral decision processes, horizontal networks, and a strong corporate-wide business? a) modular network b) horizontal corporation c) modular corporation d) virtual organization

horizontal corporation

Kya believes an annual review should be a reflection of an employee's accomplishments from the year while Marcus believes an annual review should be used to motivate an employee to work harder. Their beliefs are based on the culture in which they were raised. Which business function is being affected by culture in this scenario? a) production b) human resources c) accounting d) marketing

human resources

What is an example of an internal force that can affect a company's environment? a) human resources b) economic downturn c) availability of natural resources d) international competitors

human resources

According to the text, personnel working in a foreign subsidiary are working in the international environment a) if they are responsible for the subsidiary's exports. b) if they work and live in the foreign subsidiary's country. c) if they are responsible for manufacturing activities within the foreign subsidiary. d) if they are responsible for the management of the foreign subsidiary.

if they are responsible for the subsidiary's exports.

Shondra grew up in eastern Europe but moved to New York after college. Compared to her friends that stayed in Europe, she enjoys much more freedom with her time and is able to enjoy leisure activities and be active in her career. Which of Hofstede's dimensions does this demonstrate? a) indulgence vs. restraint b) masculinity vs. femininity c) pragmatic vs. normative d) uncertainty avoidance

indulgence vs. restraint

Keller Corp., based in Virginia, has exported its line of luggage and travel products into Europe for the past three years and has decided to create a new division based in Paris to handle all overseas activity. What type of division is the company creating? a) international b) domestic c) global d) regional

international

Jetson Manufacturing has manufacturing operations in the United States, Germany, Indonesia, and Brazil. Jetson Manufacturing is an example of a(n) a) distribution center. b) international affiliate. c) international company. d) state-owned corporation.

international company.

Malek Inc. has implemented a company structure in which the domestic product division is responsible for all global line and staff operations. In addition, each product division is responsible for the worldwide operation efforts of marketing and production. Which structure does this company use? a) geographic region b) international product c) hybrid d) global functional

international product

When interacting with an international affiliate, business professionals should remember that ethnocentrism a) can be beneficial to negotiations. b) is atypical behavior and uncommon in most cultures. c) is detrimental and noninclusive. d) should be practiced whenever possible.

is detrimental and noninclusive.

Generally, management prefers global product standardization because a) it creates lower costs. b) marketing campaigns must be consistent. c) packaging cannot be changed to please a single market. d) it eliminates economies of scale.

it creates lower costs.

The practices that organizations and their managers use for identifying, creating, acquiring, developing, dispersing, and exploiting competitively valuable knowledge is known as a) competitive advantage. b) international strategy. c) value analysis. d) knowledge management.

knowledge management.

Jake asked his team to find out how many employees were available in the proposed foreign market that had the data analysis skills the company needed to complete the task. This information will help him decide if the foreign market is viable for the company to enter into. What type of information is Jake looking for? a) population size b) population growth c) labor market d) labor force

labor market

Within a horizontal corporation, the decision-making process is best described as a) virtual. b) hierarchical. c) vertical. d) lateral.

lateral.

Jet Spray Water Equipment Corp. decided to pull out of doing business in Europe when it learned that some governments required more than 50 percent of the product be made in that country. Which foreign environmental force is causing the company to make this decision? a) sociocultural b) legal c) physical d) economic

legal

In larger, older organizations, more decisions are a) delegated to the subsidiary headquarters. b) delegated to empowered, decentralized subsidiary managers. c) made at headquarters of the parent company. d) made jointly between the subsidiary and parent company.

made at headquarters of the parent company.

What is identified in the text as being one of the five major drivers of globalization? a) transportation b) cultural c) monetary d) market

market

When a supplier to an original equipment manufacturer (e.g., a battery manufacturer supplying an automobile producer) follows its major customer to a new country, it is an example of a ________ driver of international business activity. a) cost b) political technological c) technological d) market

market

Adam Smith argued against mercantilism by claiming that a) customers' tastes are affected by income levels. b) governments, not market forces, should determine the directions, volume, and composition of international trade. c) market forces, not government controls, should determine direction, volume, and the composition of international trade. d) a nation could trade advantageously if it had a comparative advantage.

market forces, not government controls, should determine direction, volume, and the composition of international trade.

One cultural difference that companies have had to adjust to when entering the global market is the local habits of daily shopping. This habit requires companies to a) market their products in smaller packages. b) focus more on price than value. c) focus more on value than price. d) source more materials locally.

market their products in smaller packages.

The focus group participants were asked if they liked the website for Welby Appliance Corp. The majority responded that they did. Months later, the manufacturer was surprised when people in certain parts of the world were angry that no instructions came with the appliance they purchased and were told they could find them on the website. However, these particular customers didn't have access to a computer. In this instance, what department of Welby Appliance failed to take into account culture? a) human resources b) finance c) production d) marketing

marketing

An organization in which top-level divisions are required to heed input from a staff composed of experts from another organizational dimension in an attempt to avoid the double-reporting difficulty of a matrix organization but still mesh two or more dimensions is known as a a) hybrid organization. b) matrix organization. c) matrix overlay. d) virtual corporation.

matrix overlay.

One advantage of companies with global structures is that they a) outperform those with international divisions. b) are organized on the basis of geography and not on products or processes. c) are large companies with numerous overseas manufacturing facilities. d) may obtain lower production costs by promoting worldwide product standardization.

may obtain lower production costs by promoting worldwide product standardization.

Worldwide, labor tends to be a) immobile. b) unreliable. c) mobile. d) well-trained.

mobile.

Compared to 1980, service exports in 2017 can best be described as a) struggling to flourish based on government restrictions. b) decreasing due to more international corporations. c) more than thirteen times larger. d) lower than they were in 1980.

more than thirteen times larger.

When there is strong pressure for a company to adapt its products or services for local markets, it should probably rely on a a) home replication strategy. b) multidomestic strategy. c) transitional strategy. d) global strategy.

multidomestic strategy.

Trompenaars's dimension of internal vs. external direction is similar to Kluckhohn and Strodtbeck's relationship to a) nature. b) religion. c) behaviors. d) social life.

nature.

Connor's manager told him not to make the "OK" sign with his hand when meeting with the representatives from France as that gesture is viewed as vulgar and inappropriate in their culture. Which aspect of culture is his manager referring to? a) religion b) material culture c) spoken language d) nonverbal communication

nonverbal communication

Generalizations about TCNs are difficult because a) the IC usually does not know enough about their backgrounds. b) the geocentric staffing policy prohibits these generalizations. c) the use of TCNs is a new phenomenon and we don't know much about them yet. d) people achieve the TCN status in different ways.

people achieve the TCN status in different ways.

In terms of worker compensation associated with an IC, health insurance is considered a(n) a) perk. b) bonus. c) premium. d) allowance.

perk.

Gibson Baking Company sells its brownie mixes all over the world. The company includes directions on the package for baking the product at high altitude levels since this can affect baking times. Which type of environmental force caused this decision? a) economic b) legal c) physical d) sociocultural

physical

Tactical plans are more detailed than strategic plans. a) True b) False

True

What is an argument presented by opponents of globalization? a) Developing countries may feel that lower-cost labor constitutes their competitive advantage and that if they are forced to implement more stringent labor standards, it may damage their prospects for improved economic development. b) A report by the Labor Secretariat for the North American Free Trade Agreement (NAFTA) reported that more than half of firms surveyed used threats to close U.S. operations as a tool to fight union-organizing efforts. c) Although labor standards in developing countries are usually lower than in industrialized countries, they are rising. d) Multinationals investing in host nations pay higher wages, create new jobs at a faster rate, and spend more on R&D than do local firms.

A report by the Labor Secretariat for the North American Free Trade Agreement (NAFTA) reported that more than half of firms surveyed used threats to close U.S. operations as a tool to fight union-organizing efforts.

Who advocated the early attempt to develop an international trade theory in response to the practice of mercantilism? a) Raymond Vernon b) David Ricardo c) Stefan Linder d) Adam Smith

Adam Smith

According to the Harvard Business Review article: The New Era of Globalization Will Be Shaped by Customers, which, if any, of the following are identified as factors assuming greater weight tan the dirve to find the lowest possbile global labor costs? a) None of the above b) Proximity to customers c) All of the above d) The availability of a more highly skilled workforces

All of the above

________ was the world's leading manufacturing country for about 1,800 years, until it was replaced by Britain in about 1840. a) Germany b) The United States c) India d) China

China

Which countries have become more important trading partners to the United States as suppliers of electronic products? a) Germany and the United Kingdom b) China and Canada. c) China and Malaysia d) Canada and Mexico.

China and Malaysia

Urban Necessities is planning its promotional strategy as it enters the foreign marketplace. The company's line of clothing serves the same function around the world so it can be promoted in the same way. However, the company will need to make slight changes to some of the clothing to meet local customer needs. Which promotion strategy should the company use? a) Different product-same message b) Product adaptation-same message c) Same product-same message d) Same product-different message

Product adaptation-same message

Which characteristic would be typical in a feminine culture? a) Environmental matters are a personal, not a business, concern. b) People live in order to work. c) Quality of work life is important. d) Strong variation between male and female roles.

Quality of work life is important.

Nations listed in the text as losing the largest number of their people to emigration include a) Mexico, Canada, and the United States. b) Russia, China, and India. c) Germany, Russia, and Ukraine. d) India, Russia, and the United States.

Russia, China, and India.

Green Fields Coffee Co. introduced its line of herbal coffees to the international market two years ago. They were well received and now foreign competitors are starting to appear. Which stage of the product life cycle theory is the company currently in? a) Stage 3 b) Stage 1 c) Stage 2 d) Stage 4

Stage 3

__________ are organizational forms in which product divisions are defined as though they were independent businesses. a) Free-form management units b) Strategic business units c) Matrix overlays d) Virtual corporations

Strategic business units

Overall, what has occurred with the dollar volume of service exports worldwide? a) The dollar volume of exports has maintained a low, but consistent, rate. b) Service exports have decreased with the advent of competition. c) There has been an absolute increase. d) There has been no change.

There has been an absolute increase.

What is a disadvantage of bottom-up planning? a) It restricts initiative at lower levels of the organization. b) It shows some insensitivity to local conditions, particularly when a company's top management team exhibits ethnocentric tendencies. c) There is no guarantee that the sum total of all the affiliates' goals will coincide with those of headquarters. d) Subsidiary directors' hands-on perspective may allow them to recognize potentially innovative opportunities.

There is no guarantee that the sum total of all the affiliates' goals will coincide with those of headquarters.

Which statement describes economies of scale? a) They occur due to the presence of abundance resource endowments within a nation. b) They are the predictable decline in the average cost of producing each unit of output as a production facility gets larger and output increases. c) They refer to the rising scale on which efficiency improves as a result of cumulative experience and learning. d) They are only relevant to manufacturing industries.

They are the predictable decline in the average cost of producing each unit of output as a production facility gets larger and output increases.

How have the new directions in planning affected companies? a) They have made strategic planners dominant in the planning process. b) They have brought operating managers into the planning process. c) They have relieved the firm's chief executive officer of the responsibility for strategic planning. d) They have made strategic planning longer term in orientation, typically planning 5 to 10 years into the future.

They have brought operating managers into the planning process.

What is an accurate description of an IC's structures and systems? a) Management must avoid changing them over time, to avoid disrupting operations. b) They must be designed before a company can develop its strategy. c) They need to be able to evolve over time. d) They depend on the country in which the IC is headquartered.

They need to be able to evolve over time.

The argument that free trade is the best strategy for advancing the world's economic development is considered a) a proposition with which almost all economists agree. b) the basis for much protectionist legislation in emerging markets. c) one of the most contentious issues associated with economic globalization. d) one that has very little support in research studies.

a proposition with which almost all economists agree.

The theory of resource endowment explains a) that a nation will trade goods that can be produced with the production factor that is most abundant. b) why an automobile can be made either by hand or by a capital-intensive process. c) why France sends cosmetics, wine, and clothing to Chile. d) that a nation less efficient in producing a good has a comparative advantage.

that a nation will trade goods that can be produced with the production factor that is most abundant.

In low-context cultures it is common to find a) that communication tends to be explicit. b) indirection is prized because it recognizes the ability of the other. c) subtlety and innuendo during conversations. d) leadership is mostly from behind, allowing the workgroup to self-direct.

that communication tends to be explicit.

Referring to Hall's high- and low-context framework, in a high-context culture a) the context is irrelevant. b) communication is explicit. c) the context carries much of the communication. d) communication is direct and focused on the topic.

the context carries much of the communication.

Hofstede's individualism-collectivism measures a) the degree to which social inequality is tolerated. b) the amount of social distance between relatives. c) the degree to which people in the culture are integrated into groups. d) the tendency to differentiate male roles.

the degree to which people in the culture are integrated into groups.