Multiple Choice Answers
Question: The opening case in the text that profiles the rise of the automobile industry in India mentions that Nissan has invested in a new factory close to Hyundai’s in the southern city of Chennai. If it were to be assumed that Nissan chose the manufacturing location based on the ready availability of an appropriately skilled labor pool and supporting industries, it could be said that Nissan was leveraging
A Cultural factors
C Exchange rates
D FDI regulations
Question: Which of the following is true about the incidence of counter trade?
A During the 1980s, counter trade sharply declined in popularity among developing nations
B Today, some successor states to the former Soviet Union periodically use counter trade
C In the modern era, countertrade arose in the 1980s
D In the modern era, counter trade arose as a way for the United States to purchase imports
Question: Which of the following is not a distinct counter trade arrangement?
B Counter purchase
C Switch trading
Question: What limits a country’s ability to use the same marketing message and selling approach worldwide?
A Source effects
C Cultural differences
Question: Japanese businessman, Ohno Taiichi, saw numerous problems with Toyota’s mass production philosophy for making cars. Which of the following is one of the problems?
A Short production runs created a scarcity of inventories
B It hampered the achievement of economies of scale
C Inability to accommodate consumer preferences for product diversity
D It resulted in antagonizing workers in the United States
Question: If a firm is trying to create value by transferring core competencies to a foreign operation, it may believe that the best way to do so is to transfer parent-country nationals who have knowledge of that competency to the foreign operation. This is a reason for the firm to pursue a(n) _____ staffing policy.
Question: Which of the following is an advantage of adopting a geocentric staffing approach?
A The multinational composition of the team reduces cultural myopia and enhances local responsiveness
B It is inexpensive to implement
C It reduces the costs of value creation
D The firm may believe the host country lacks qualified individuals to fill senior management positions
Question: Clive, who was working as a manager in India, was a little shocked to receive a negative feedback for his lack of expertise and aptitude to take effective decisions. All that he had to say was that he had tried to involve his team in participative decision making and that this might have led them to think so. Clive’s negative feedback could be attributed to _____.
A Ineffective transfer of skills
B Cultural myopia
C Unintentional bias
D Poor expectation setting
Question: Because of the improved communication and transportation infrastructures and the education level of the population during the past 20 years, many international businesses view foreign factories as
A Low-cost manufacturing facilities
B Globally dispersed centers of excellence
Question: According to the results of a study by R.L. Tung, the number one reason that Japanese expatriate managers fail is
A The inability of spouse to adjust
B The lack of technical competence
C Personal or emotional problems
D The inability to cope with larger overseas responsibilities
Question: With regard to the types of allowances often included in an expatriate’s compensation package, a(n) _____ allowance is paid when the expatriate is being sent to a difficult location.
Question: The use of price as a competitive weapon to drive weaker competitors out of a national market is called
A Multipoint pricing
B Predatory pricing
C Forward pricing
D Supra-competitive pricing
Question: In countries such as Great Britain, Germany, and the United States
A Channel lengths are short and the retail system is fragmented
B Channel lengths are short and the retail system is concentrated
C Channel lengths are long and the retail system is fragmented
D Channel lengths are long and the retail system is concentrated
Question: Which of the following two international strategies are most compatible with a geocentric staffing policy?
A Global standardization and transnational
B Localization and transnational
C International and multidomestic
D Global standardization and multidomestic
Question: Why is barter not a common arrangement?
A It is a very complex arrangement
B It is primarily used with trading partners who are generally not considered creditworthy
C Firms run the risk of having to accept goods they do not want
D When the goods are exchanged simultaneously, one partner ends up financing the other
Question: Which of the following is one of the advantages that accrue to a firm that buys component parts from independent suppliers?
A It facilitates the scheduling of adjacent processes
B It protects proprietary production technology
C It can facilitate investments in highly specialized assets
D It may help capture orders from international customers
Question: The rapid development of the Internet in recent years has helped to
A Shorten channel length
B Temporize channel length
C Concentrate the retail system
D Fragment the retail system
Question: In poor nations
A Direct selling may be the only way to reach consumers
B A pull strategy is generally favored
C A product’s attributes are well understood
D High-quality channels exist that provide point-of-sale assistance
Question: Which of the following is the most notable trend in the global retail industry in the last decade?
Question: In which of the following instances does concentration of production make most sense?
A Location externalities are not important
B The production technology has low fixed costs
C Important exchange rates are expected to remain relatively stable
D Flexible manufacturing technology is not available Not 100% certain on this one though
Question: One aspect of a(n) _____ staffing policy is the need for a cadre of international managers that may include many different nationalities.
Question: _____ refers to the extent to which the place of manufacturing influences product evaluations.
A Noise barriers
B Country of origin effects
C Social effects
D Host country effects
Question: Which of the following is an advantage of adopting a polycentric staffing approach?
A It may be less expensive to implement compared to other approaches, reducing the costs of value creation
B Host-country nationals have unlimited opportunities to gain experience outside their own country
C It enables the firm to make the best use of its human resources
D It enables the firm to build a cadre of international executives who feel at home working in a number of cultures
Question: Time drafts
A Have no value given the deferred nature of document
B Are generally not preferred in international transactions
C Are negotiable instruments
D Are also called bills of lading
Question: What is the main attraction of counter trade?
A Firms can avoid setting up in-house trading departments
B It addresses the issue of lack of trust in international business
C A firm can finance an export deal when other means are not available
D Firms usually would not prefer to be paid in hard currency
Question: When managers in an international business consider market segmentation in foreign countries, they need to be cognizant of the differences between countries in the structure of market segments and existence of market segments that
A In the home country
B Transcend national borders
C Are divided by gender
D Are based on home market models
Question: The letter of credit
A States that the bank will pay a specified sum of money to a beneficiary on presentation of particular, specified documents
B Is an order written by an exporter instructing an importer to pay a specified amount of money at a specified time
C Serves as a receipt, a contract, and a document of title
D Indicates that the carrier has received the merchandise described on the face of the document
Question: Which of the following strategies is most compatible with a polycentric staffing policy?
A International strategy
B Global standardization strategy
C Localization strategy
D Transnational strategy
Question: Pull strategies tend to be emphasized for
A Complex new products
B Consumer goods
C Industrial goods
Question: International businesses increasingly are using management development as a strategic tool; this is particularly true in firms pursuing a(n) _____ strategy as such firms need a strong unifying corporate culture and informal management networks to assist in coordination and control.
D Global standardization
Question: Many firms pay foreign service premiums as a percentage of base salary, ranging from _____ percent after tax.
A 50 to 60
B 5 to 15
C 30 to 50
D 10 to 30
Question: Occidental Petroleum negotiated a deal with Russia under which Occidental would build several ammonia plants in Russia and as partial payment receive ammonia over a 20-year period. This is an example of
A Switch trading
B A buyback
C A counter purchase
D An offset
Question: Albania offered such items as spring water, tomato juice, and chrome ore in exchange for a $60 million fertilizer and methanol complex. Which type of countertrade is this?
B Switch trading
Question: Which of the following is true of price discrimination?
A It exists whenever consumers in different countries are charged different prices for different products
B It involves charging whatever the market will bear
C It can help a company minimize its costs
D It is against economic sense to charge different prices in different countries
Question: 3M has built its export success on all of the following principles except
A Adding additional product lines once export operation is successful
B Getting into a market first and then learning about the country
C Hiring locals to promote the firm’s products
D Entering on a small scale to reduce risks
Question: Which of the following is a drawback of adopting a polycentric staffing approach?
A It is expensive to implement
B The higher pay enjoyed by managers placed on an international fast track may be a source of resentment within the firm
C It limits advancement opportunities for host-country nationals
D The gap that can form between host-country managers and parent-country managers
Question: The TQM philosophy was developed by a number of American consultants. Which of the following individuals is one of them?
A Joseph Juran
B Philip Kotler
C Paul Harmon
D Émile Durkheim
Question: The global corporation
A Considers the world to consist of distinct and unique entities
B Operates at low relative costs
C Operates from any one country
D Adjusts its products and practices to each country
Question: Because of formal and informal trade barriers and the uncertainties of the world’s current floating exchange rate regime, several automobile companies have established top-to-bottom manufacturing operations in three major regional markets. Which of the following is one of them?
C South America
D Western Europe
Question: A _____ is issued to the exporter by the common carrier transporting the merchandise and it serves as a receipt, a contract, and a document of title.
A Bill of lading
D Letter of credit
Question: Which of the following is a drawback of relying on an EMC?
A They do not provide references and have no antecedents
B The exporting company can fail to develop its own exporting capabilities
C They typically add little value to the exporting company
D They typically lack knowledge about the local business regulations
Question: _____, or reductions in unit costs as plant output expands, are achieved because of greater utilization of capital equipment and the productivity gains that come with specialization of employees within the plant.
A Minimum efficient scale
B Production cost curve
C Maximum efficient scale
D Economies of scale
Question: The mission of the _____ is to provide financing aid that will facilitate exports, imports, and the exchange of commodities between the United States and other countries.
A Sogo shosha
B World Bank
C Overseas Commercial Service
D Ex-Im Bank
Question: Which of the following is an advantage of a geocentric approach to staffing for international businesses?
A It permits better corporate center control
B It is inexpensive to implement
C It helps build a strong culture
D It helps transfer core competencies
Question: A citizen of Japan who moves to the United States to work at Microsoft would be classified as a(n)
C Third-country national
D Host-country national
Question: When should an exporter get export credit insurance?
A When the exporter is facing a situation where the importer may default on payment
B When the exporter is dealing with a country that has a nonconvertible currency
C When he is unable to obtain any pre-export financing
D When the exporter has received a letter of credit from the importer’s bank
Question: Re-entry of expatriate managers into their home-country organization is termed _____.
Question: Historically, most outsourcing decisions have involved
A The manufacture of physical products
B The procurement of agricultural products
C The mining of precious resources
D The provision services
Question: In an international context, _____ exists whenever consumers in different countries are charged different prices for the same product.
A Standardized pricing
B Global pricing
C Predatory pricing
D Price discrimination