MGMT 425 Test 1

false

"Not free" countries are characterized by some restrictions on political rights and civil liberties, often in the context of corruption, weak rule of law, ethnic strife, or civil war.

false

A civil law system tends to be more adversarial than a common law system.

False

A common feature of many right-wing dictatorships is that they support socialist or communist ideas.

true

A mudarabah contract of Islamic banks is similar to a profit-sharing scheme.

true

A small country is short on cash for much needed infrastructure development projects. It could go to the World Bank for assistance.

ideas about what a group believes to be good, right, and desirable.

A typical American value is an expectation that people have a right to live the way they want. Values are defined as Multiple Choice the routine conventions of everyday life. the social rules and guidelines that prescribe appropriate behavior in particular situations. ideas about what a group believes to be good, right, and desirable. norms that are central to the functioning of a society and to its social life.

As countries get richer, there seems to be a shift from survival values to well-being values.

According to the findings of the World Values Survey, Multiple Choice As countries get richer, there seems to be a shift from survival values to well-being values. economic progress is accompanied by a shift in values away from individualism to collectivism. globalization has resulted in increasing divergence across cultures. as countries get richer, a shift occurs away from secular values to traditional values.

first-mover

Amazon.com was the earliest, major online bookstore, which allowed it to generate brand awareness and have a significant presence in the market. Amazon.com had a head start on later entrants to the online bookstore market. In this example, Amazon.com has ________ advantages. Multiple Choice first-mover vertical integration free rider horizontal integration

B

An international business is defined as A. a business that is restricted by U.N. regulations. B. one that implements homogenous practices across countries. C. the basis for a multinational enterprise. D. any firm that engages in international trade

very detailed with contingencies spelled out.

Contracts drafted under a common law framework tend to be Multiple Choice very detailed with contingencies spelled out. inflexible and difficult to adjudicate. very short and general in scope. inexpensive to draw up between two parties.

greater economic growth rates

Countries with free market economies in which property rights are protected tend to have ________ than command economies or economies where property rights are poorly protected. Multiple Choice slower economic growth rates higher gross national incomes lower gross national incomes greater economic growth rates

False

Cultural differences have no effect on the way an international firm conducts its business around the globe.

true

Deregulation involves the establishment and operation of private enterprises.

more committed to free market capitalism

During the late 1980s and early 1990s, totalitarian governments collapsed and were replaced by democratically elected governments that were typically ________ than their predecessors had been. Multiple Choice more committed to free market capitalism less committed to free market capitalism less committed to privatization more committed to a planned economy

false

Entrepreneurs and business-owners of high uncertainty avoidance cultures will be more willing to take risks and make changes.

business activities outside its home country.

Foreign direct investment occurs when a firm invests resources in local agricultural production. production and service technologies that will enhance globalization. competitor-based products. business activities outside its home country.

true

GNI per person figures can be misleading because they don't consider differences in the cost of living.

a society that allows relatively free gratification of basic and natural human drives related to enjoying life and having fun.

Geert Hofstede added the dimension of indulgence to the World Values Survey to refer to Multiple Choice the extent to which different cultures socialized women into tolerating uncertainty. attitudes toward time, persistence, ordering by status, protection of face, respect for tradition, and reciprocation of gifts and favors. a society that suppresses gratification of needs and regulates it by means of strict social norms. a society that allows relatively free gratification of basic and natural human drives related to enjoying life and having fun.

migration of low-wage manufacturing jobs offshore

Globalization critics argue that the decline in unskilled wage rates is due to the regulation of the global market by WTO. technology-induced shift toward skilled jobs. privatization of government owned enterprises. migration of low-wage manufacturing jobs offshore.

creating manufacturing units in developing countries.Correct

Globalization has enabled organizations to reduce their costs of production by Multiple Choice setting up barriers to cross-border trade. differentiating material culture the world over. creating manufacturing units in developing countries.Correct turning national economies into self-contained entities.

False

Globalization resulted in a decrease in non-U.S. firms' investment across national borders.

communist

Historically, command economies were found in ________ countries, where collectivist goals were given priority over individual goals. Multiple Choice free-market communist democratic libertarian

the relationship between gender and work roles

Hofstede's masculinity versus femininity dimension examined Multiple Choice the cultural changes resulting from women's liberation movements. the relationship between gender and work roles the impact of education on the gender roles attributed to men and women. the extent to which different cultures socialized women into tolerating uncertainty.

true

Hofstede's power distance dimension focused on how a society deals with the fact that people are unequal in physical and intellectual capabilities.

clash of value systems and ideology.

In Samuel Huntington's thesis, global terrorism is a product of the Multiple Choice clash of value systems and ideology. advances in communication technology. unequal distribution of income in developing nations. low level of education and literacy.

false

In a command economy, certain sectors of the economy are left to private ownership and free market mechanisms, while other sectors have significant state ownership and government planning.

true

In a market economy, a supply restriction occurs when a single firm monopolizes a market.

false

In calculating GNI data in some countries, the official figures take into account the barter agreements that take place as part of daily business transactions.

removing price controls

In the case of command economies, deregulation involves Multiple Choice removing price controls detailed state planning. exercising tight control over foreign trade. encouraging state ownership of enterprises.

true

In the early twentieth century, the socialist ideology split into two broad camps: communists and social democrats.

creating new products and markets.

Innovation and entrepreneurial activity help increase economic activity by Multiple Choice strengthening business infrastructure. eliminating state-run enterprises. creating new products and markets. providing more authority to government officials.

true

It can be more costly to do business in a country where there are laws and regulations with regard to product safety.

cooperation between a company and its suppliers on issues such as design, quality control, and inventory reduction

It has been argued that the success of Japanese enterprises in the global economy has been based partly on which of the following? Multiple Choice compartmentalization of different functions within Japanese companies consolidation of self-managing work teams cooperation between a company and its suppliers on issues such as design, quality control, and inventory reduction high degree of managerial mobility between companies

true

It may be more costly to do business in relatively primitive or undeveloped economies because of the lack of infrastructure and supporting businesses.

the routine conventions of everyday life

Jonathon's family makes a point to sit down to dinner together every night. This is an example of folkways, which are characterized as Multiple Choice norms that are central to the functioning of a society and to its social life. a group of people who share a common set of values and norms. the routine conventions of everyday life. abstract ideas about what a group believes to be good, right, and desirable.

There is no guarantee that democracy will thrive in many of the world's newer democratic states.

Many of the national markets of Eastern Europe, Latin America, Africa, and Asia may still be underdeveloped, but they are potentially enormous. Which of the following is a risk to businesses moving into these regions? Multiple Choice It is likely that communist dictatorships will return to these regions. There is no guarantee that democracy will thrive in many of the world's newer democratic states. Businesses in emerging markets are frequently taken over by the states. These regions are likely to have consistent domestic economic growth and not be open to foreign investment.

true

Most of the world's ethical systems are the product of religions.

they continue to receive subsidies from the state.

Newly privatized entities often have little incentive to restructure their operations to become more efficient when Multiple Choice they continue to receive subsidies from the state. prices are set by the forces of demand and supply. they are faced with intense foreign competition. foreign investment is permitted by the state.

true

One concern frequently voiced by those opposed to globalization is that falling barriers to international trade destroy manufacturing jobs in wealthy advanced economies such as the United States and Western Europe.

true

One of the biggest dangers confronting a company that goes abroad for the first time is the danger of being ill-informed.

allow firms to move manufacturing activities to countries with lower wage rates.

Opponents of globalization argue that falling trade barriers: create manufacturing jobs in wealthy advanced economies. allow firms to move manufacturing activities to countries with lower wage rates. reduce the pool of global labor. force countries to maintain manufacturing in their home countries regardless of wage rates

false

Over the last 30 years, while democracy has spread, it has been natural for totalitarianism to also spread.

false

People who violate folkways are considered to be evil or bad.

A caste system is a rigid form of social stratification.

Priyansh grew up in India, where caste systems have become less prevalent. Which of the following statements is true about a caste system? Multiple Choice A caste system is an open system of stratification. A caste system is a rigid form of social stratification. A caste system is characterized by high social mobility. In a caste system, social position is determined by individual performance.

false

Since the 1960s, a notable trend in the demographics of the multinational enterprise has been the rise of U.S. multinationals.

False

Since the demise of communism in the late 1980s, the number of command economies has risen dramatically.

true

Supporters of globalization believe that tougher environmental regulations and stricter labor standards are a natural aspect of economic progress.

social democrats

The ________ committed themselves to achieving socialism without resorting to violent revolution and dictatorship. Multiple Choice anarchists Maoists communists social democrats

International Monetary Fund

The ________ is often seen as the lender of last resort. Multiple Choice: International Monetary Fund International Development Association World Trade Organization World Bank

World Bank

The ________ was created in 1944 by 44 nations that met in Bretton Woods, New Hampshire to promote economic development. Multiple Choice World Trade Organization United Nations International Trade Center World Bank

ethnocentrism

The belief in the superiority of one's own culture is known as Multiple Choice cultural relativism. ethnocentrism. cross-cultural literacy. the convergence hypothesis.

political, economic, and legal systems

The benefits, costs, and risks associated with doing business in a country are a function of that country's Multiple Choice political system only. legal system only. economic system only. political, economic, and legal systems.

based on tradition, precedent, and custom.

The common law system is Multiple Choice based on a detailed set of laws organized into codes. not as flexible as other systems. open to giving judges the power only to apply the law. based on tradition, precedent, and custom.

theocratic

The government of Iran is ruled by religious figures and they ensure that citizens adhere to Islamic teachings. Iran is a ________ law system. Multiple Choice traditional civil common theocratic

reduce the number of people living in extreme poverty.

The purpose of the U.N.'s Millennium Development Goals that were established in 2000 was to Multiple Choice: increase the supply of consumer goods to developing countries. reduce the number of people living in extreme poverty. legitimize the globalization process. increase the employment rate across all nations.

encouraging vigorous free and fair competition among private producers.

The role of the government in a market economy involves Multiple Choice planning the types and quantities of goods and services to be produced. determining the prices at which goods and services will be sold. encouraging vigorous free and fair competition among private producers. mobilizing economic resources of the country for public good

norms

The social rules and guidelines that prescribe appropriate behavior in a particular situation are called Multiple Choice mores. values. folkways. norms.

the total cumulative value of foreign investments as a percentage of the country's GDP.

The stock of foreign direct investment refers to Multiple Choice the total cumulative value of foreign investments as a percentage of the country's GDP. the entry of funds into a country when foreigners make purchases in the country's stock and bond markets. movements of labor, capital, and other factors of production between countries. total export or import products from other countries.

false

The value systems and norms of a country have little influence on the costs of doing business in that country.

true

Today, nearly every nation in the world belongs to the United Nations.

quality of human life in different nations

United Nations has developed the Human Development Index (HDI) to measure the Multiple Choice relative access to education of males and females. level of political and economic freedom available to citizens. quality of human life in different nations total income in different nations.

Christianity

What is the most widely practiced religion in the world? Multiple Choice Islam Buddhism Hinduism Christianity

establishment of the World Trade Organization

Which of the following actions was implemented in the Uruguay Round, finalized in December 1993? Multiple Choice extension of the GATT to cover consumer products reduction in the protection for patents, trademarks, and copyrights enhancement of trade barriers establishment of the World Trade Organization

The emphasis on individual religious freedom

Which of the following aspects of Protestantism paved the way for the subsequent emphasis on individual economic and political freedoms? Multiple Choice The emphasis on individual religious freedom The emphasis on experiencing worldly pleasures The emphasis on individual purity and focus on spiritual rather than economic pursuits The promise of salvation in the next world rather than this world

A country sells its postal services to a consortium of companies that runs it as a profit making venture without any state funding.

Which of the following exemplifies privatization? Multiple Choice A country sells its postal services to a consortium of companies that runs it as a profit making venture without any state funding. A country reduces trade barriers, allowing individuals to engage in export and import. A country allows state-owned coal companies to sell coal to private parties. A country enlists the services of SomersConsultancy, a global management consulting firm, to improve the profitability of the state-owned airlines company.

An international business must find ways to work within the limits imposed by government intervention in the international trade and investment system

Which of the following expresses one of the reasons why managing an international business is different from managing a purely domestic business? Multiple Choice: The range of problems confronted by a manager in a domestic business is wider and the problems more complex than those confronted by a manager in an international business. International business transactions use the euro instead of the U.S. dollar. An international business must find ways to work within the limits imposed by government intervention in the international trade and investment system An international business does not need to contend with government intervention whereas a domestic business must work within the confines of its local government.

countries progressively raising trade barriers against each other

Which of the following factors contributed to the Great Depression of the 1930s? countries progressively raising trade barriers against each other artificial fixing of currency rate by China problems in the U.S. subprime mortgage lending market outsourcing of manufacturing units to developed nations

lack of loyalty and commitment to an individual company

Which of the following is a disadvantage of a high degree of managerial mobility between companies? Multiple Choice lack of loyalty and commitment to an individual company decrease in entrepreneurship executives are not exposed to different ways of doing business stagnation of the economy

Provision of partial individual economic freedom along with restricted individual political freedom

Which of the following is a feature of right-wing totalitarianism? Multiple Choice Monopoly of a group/party that represents the interests of a particular tribe. Involvement of people in the government, exercised either directly or through elected representatives. Governance by a single party, group, or individual based on religious principles. Provision of partial individual economic freedom along with restricted individual political freedom

A nation with a market-based economic system

Which of the following is a more attractive place to do business? Multiple Choice A nation where the rule of law does not take precedence over business A nation with a market-based economic system A nation that lacks democratic institutions A nation where economic activity is regulated by the state

totalitarian regimes failing to deliver economic progress to the majority of their populations

Which of the following is a reason for the spread of democracy? Multiple Choice totalitarian regimes failing to deliver economic progress to the majority of their populations the economic advances of the past quarter century leading to increasingly poorer middle and working classes new information and communication technologies increasing the state's ability to control access to uncensored information the unchallenged pressure of entrepreneurs and other business leaders for less accountable and closed governments

In a planned economy, the state owns all means of production.

Which of the following is true about planned economies? Multiple Choice In a planned economy, the state owns all means of production. In a planned economy, market regulations reduce the risk of economic stagnation. In a planned economy, entrepreneurs have economic incentives that encourage innovation. In a planned economy, individuals benefit more from innovations than the state does.

The inflation rate in a country is an indicator of the economic risks of doing business in a country.

Which of the following is true about the economic risks of doing business in a country? Multiple Choice Countries with weaker property laws tend to have higher economic growth, and involve less risk. It is less costly to do business in relatively primitive or undeveloped economies. Economic risks are independent of political risks. The inflation rate in a country is an indicator of the economic risks of doing business in a country.

Collectivism

Which of the following philosophies can be traced back to the ancient Greek philosopher Plato? Multiple Choice Individualism Hedonism Socialism Collectivism

Trademarks are designs and names by which businesses differentiate their products

Which of the following statements is true about trademarks? Multiple Choice Trademarks specify certain safety standards to which a product must adhere. Trademarks grant the inventor of a new product or process exclusive rights for a defined period to the manufacture, use, or sale of that invention Trademarks are designs and names by which businesses differentiate their products Trademarks are the exclusive legal rights of authors, composers, playwrights, artists, and publishers to publish and disperse their work as they see fit.

The world is moving toward an economic system that is more favorable for international business.Correct

Which of the following statements pertaining to changes in the global economy of the 21st century is true? Multiple Choice National economies are becoming more independent. Volume of global output has been growing more rapidly than cross-border trade and investment. Barriers to the free flow of goods, services, and capital have increased. The world is moving toward an economic system that is more favorable for international business.Correct

All businesses are owned by the state

Which of these is a characteristic of a pure command economy? Multiple Choice Prices are determined by market forces. All businesses are owned by the state There is free and fair competition between private producers. The goods and services that a country produces are planned by consumers.

Public action

_______ is the extortion of income or resources of property holders by public officials such as politicians and government bureaucrats. Multiple Choice Private action Public action Corruptive action Civil action

Ethical system

_______ refers to a set of moral principles, or values, that are used to guide and shape behavior? Multiple Choice Ethical system Class consciousness Class system Caste system

Individualism

________ refers to a philosophy that a person should have freedom in his or her economic and political pursuits. Multiple Choice Collectivism Socialism Individualism Totalitarianism