Deck 3: Managing in a Global Environment

Question 1

A drawback of the geocentric perspective is that it is inflexible.

Answer 1

False

Question 2

Key advantages of the polycentric attitude include a simpler structure and tighter control.

Answer 2

False

Question 3

Part of OECD's mission is to help raise the standard of living in member countries.

Answer 3

True

Question 4

Solidarity in the European Union is being undermined by protectionist pressures in some member countries.

Question 5

African Union was formed because the economies in Africa are stagnating.

Question 6

Managers with an ethnocentric attitude would not trust foreign employees with key decisions or technology.

Question 7

The General Agreement on Tariffs and Trade (GATT) was signed in 1992 to create the EU.

Question 8

Through the creation of the EU, each member country now has increased border controls, nationalist policies, and protected industries.

Question 9

The European Commission is the executive body of the EU.

Question 10

The term multinational corporation refers to any and all types of international companies that maintain operations in multiple countries.

Question 11

The primary reason for the creation of the EU was to allow Europeans to assert their position against the industrial strength of the United States and Japan.

Question 12

A multidomestic corporation maintains significant operations in multiple countries but centralizes management decision-making in the home country.

Question 13

Both IMF and the World Bank provide temporary loans to maintain financial stability in member countries.

Question 14

BRICS is a trading alliance between 10 Southeast Asian nations.

Question 15

OECD is currently working on combating small-scale bribery in overseas commerce.

Question 16

Member countries of the EU have unanimously chosen to adopt the euro as their official currency.

Question 17

The polycentric attitude is a world-oriented view that focuses on using the best approaches and people from around the globe.

Question 18

Key advantages of an ethnocentric attitude include more support from host governments and committed local managers with high morale.

Question 19

Parochialism is the tendency to view the world narrowly through one's own perspective.

Question 20

World Bank promotes long-term economic development and poverty reduction by providing financial support for member countries.

Question 21

According to the GLOBE rankings, Germany and France are both considered low on the dimension of humane orientation.

Question 22

Managers with an ethnocentric attitude concentrate on their __________.

A) home country
B) host country
C) world orientation
D) regional orientation
E) customer orientation

Question 23

Strategic alliances are partnerships between a domestic and a foreign company in which both share resources and knowledge in developing new products or building production facilities.

Question 24

Local laws do not present barriers to foreign investment as laws of the investor countries prevail in disputes.

Question 25

A command economy is one in which resources are primarily owned and controlled by the private sector.

Question 26

With its focus on control from the home country, the global company reflects a polycentric attitude.

Question 27

Licensing is primarily used by service organizations and franchising is primarily used by manufacturing organizations.

Question 28

Planned economies encourage free markets to induce domestic growth.

Question 29

Parochialism is best defined as __________.

A) An acceptance of diverse points of view
B) a desire to leave one's own culture for a foreign culture
C) a tendency to view the world through one's own perspective
D) recognition of diverse religious beliefs
E) a tendency to view other cultures as superior to one's own

Question 30

Political interference is no longer an issue in global business as governments agree that it would hinder growth of trade agreements.

Question 31

By eliminating artificial geographical barriers, the transnational corporation reflects an ethnocentric attitude.

Question 32

Setting up a foreign subsidiary involves a higher degree of risk and commitment than franchising.

Question 33

A high uncertainty avoidance society is threatened by ambiguity and experiences high levels of anxiety.

Question 34

Licensing and franchising are similar approaches involving one organization giving another organization the right to use its brand name, technology, or product specifications in return for a lump sum payment or a fee usually based on sales.

Question 35

According to the GLOBE rankings, Canada is considered high on future orientation.

Question 36

According to the GLOBE rankings, the United States is considered low on the dimensions of assertiveness and performance orientation.

Question 37

According to the textbook, a global company is also considered a borderless organization.

Question 38

A global mind-set refers to attributes that allow a leader to be effective in cross-cultural environments.

Question 39

Titles, rank, and status are highly respected in high power distance societies.

Question 40

Research indicates that organizational culture has a stronger impact on employees than national culture.

Question 41

Which of the following is a key drawback of the geocentric attitude?

A) simpler structure
B) tighter control
C) inflexibility
D) difficult to achieve
E) social and political backlash

Question 42

A potential advantage of the polycentric attitude is __________.

A) greater support from host governments
B) tighter control of operations
C) increased efficiency
D) duplication of work
E) simpler structure

Question 43

A potential advantage of the ethnocentric attitude is __________.

A) greater support from host governments
B) tighter control of operations
C) increased flexibility
D) duplication of work
E) improved balance between local and global objectives

Question 44

The __________ was created by the unification of 12 countries in Europe in 1992.

A) European Common Market
B) European Union
C) Western European Alliance
D) Trans-European Market
E) European Economic Community

Question 45

Which of the following statements is true regarding the European Union?

A) Its membership, originally at 12 countries, now stands at more than twice that number.
B) Its member countries have unanimously chosen to adopt a single currency.
C) Other European countries are avoiding relationships with the EU.
D) Though some progress has been made, the EU has basically been a failure.
E) The EU was originally formed to help European countries reassert their economic position against the strength of the United States and China.

Question 46

Which of the following is a key drawback of the ethnocentric attitude?

A) simpler structure
B) tighter control
C) inflexibility
D) duplication of work
E) reduced efficiency

Question 47

A potential advantage of the geocentric attitude is __________.

A) simpler structure
B) tighter control of operations
C) increased efficiency
D) duplication of work
E) best people and work approaches used regardless of origin

Question 48

What is the primary reason that the intensifying economic crisis in Europe threatens to impact the decisions of global managers in the United States and throughout the world?

A) The massive debt in Greece has caused Europe to slide into a new recession.
B) New measures by the European Commission to oversee banks and to monitor national budgets have been met with resistance by euro zone members.
C) The euro zone is a larger economic unit than the United States or China and is a major source of world demand for goods and services.
D) The inability to trim benefits and free up labor markets prevents the region from spurring any significant growth over the next decade.
E) The European economic crisis induces more investment in the EU.

Question 49

McCain Foods of New Brunswick, Canada, is the world's largest producer of frozen french fries. They have manufacturing operations on six continents and employ more than 20,000 people worldwide. They hire the best people from around the globe and have a world-oriented business philosophy. McCain's global perspective is best described as __________.

A) parochialistic
B) ethnocentric
C) polycentric
D) geocentric
E) nationalistic

Question 50

Cadbury Schweppes PLC is a large beverage and candy producer based in London, England. They distribute many well-known brands in Canada, and trust their Canadian managers to make key decisions about what's best for the Canadian market. Cadbury Schweppes's global perspective is best described as __________.

A) parochialistic
B) ethnocentric
C) polycentric
D) geocentric
E) nationalistic

Question 51

__________ attitude toward managing focuses on using the best approaches and people from around the globe.

A) ethnocentric
B) nationalistic
C) monocentric
D) polycentric
E) geocentric

Question 52

Managers with a(n) ________ attitude view every foreign operation as different and hard to understand.

A) geocentric
B) polycentric
C) ethnocentric
D) assertive
E) collectivist

Question 53

An ethnocentric attitude ________.

A) prompts managers to have a global view and look for the best approaches and people regardless of origin
B) is the belief that the home country has the best work approaches and practices
C) is the view that employees in the host country know the best work approaches and practices
D) gives a manager a much broader understanding of what it takes to manage in a global environment
E) avoids unnecessary political interference of the host country government

Question 54

Through the creation of the EU, member countries now have __________.

A) better border controls
B) more government subsidies
C) increased nationalistic policies
D) protected industries
E) a single market

Question 55

Which of the following is a key drawback of the polycentric attitude?

A) simpler structure
B) tighter control
C) inflexibility
D) duplication of work
E) social and political backlash

Question 56

________ attitude is the view that employees in the host country know the best practices for running their operations.

A) collectivist
B) polycentric
C) geocentric
D) polyglot
E) ethnocentric

Question 57

McCain Foods of New Brunswick, Canada, is the world's largest producer of frozen french fries. They sell frozen food products in the United States, Britain, France, Germany, and more than 100 other countries around the world. For McCain Foods, __________ is the home country, and __________ is a host country.

A) the United States; Canada
B) Canada; Britain
C) Britain; France
D) France; Germany
E) Germany; the United States

Question 58

A manager who wishes to be successful in international business should avoid a(n) ________ attitude.

A) multicultural
B) multiracial
C) ethnocentric
D) geocentric
E) parochialistic

Question 59

Bill Sanderson, a manager in a manufacturing firm in Toronto, has a tendency to view the world only through his Canadian perspective. What can be deduced about his attitude?

A) He has an elitist attitude.
B) He has a polycentric attitude.
C) He has a parochialistic attitude.
D) He has a geocentric attitude.
E) He has an egocentric attitude.

Question 60

__________ attitude is characterized by parochialism.

A) geocentric
B) nonlinguistic
C) globalistic
D) ethnocentric
E) multilinguistic

Question 61

According to the text, which of the following is a typical definition of a multinational corporation?

A) It is a company that maintains operations in multiple countries.
B) It is a company that maintains franchises in multiple countries.
C) It is a company that has multiple home bases and manufacturing plants.
D) It is a company that pays corporate taxes in at least two countries.
E) It is a company that has an international head office

Question 62

The Maastricht Treaty led to the creation of the __________.

A) General Agreement on Tariffs and Trade (GATT)
B) World Trade Organization (WTO)
C) North America Free Trade Agreement (NAFTA)
D) European Union (EU)
E) European Economic Community (EEC)

Question 63

Montreal-based Bombardier manufactures aircraft and rail transportation equipment. They employ more than 60,000 workers in production facilities on five continents. All major management decisions continue to be made in their world headquarters in Canada. Bombardier is best described as a __________ corporation.

A) global
B) transnational
C) borderless
D) virtual
E) multidomestic

Question 64

Which of the following is a multinational corporation that tailors marketing strategies to the host country's unique characteristics?

A) borderless organization
B) global company
C) multidomestic corporation
D) transnational organization
E) born global

Question 65

Multidomestic corporations __________.

A) maintain significant operations in multiple countries but manage them from a base in the home country
B) organize by industry to eliminate the artificial geographic barriers between countries
C) decentralize decision-making to managers hired in the host countries
D) follow the tastes, preferences, and values of the home country
E) do not attempt to manage foreign operations from the host country

Question 66

Which of the following is the basic difference between multidomestic corporations and global companies?

A) Multidomestic corporations typically do business with more countries than global companies do.
B) Multidomestic corporations are run by global companies but must be owned by a local, national company.
C) Multidomestic corporations decentralize management to the local country, while global companies centralize management in the home country.
D) Multidomestic corporations pay more taxes than global companies do.
E) Global companies decentralize management to the local country, while multidomestic corporations centralize management in the home country.

Question 67

The focus on decentralized management in multidomestic corporations reflects a(n) __________ attitude.

A) ethnocentric
B) polycentric
C) multicentric
D) geocentric
E) sociocentric

Question 68

The ________ decentralizes its management and other decisions to the local country.

A) multidomestic corporation
B) global company
C) born global
D) transnational organization
E) borderless organization

Question 69

When an organization drops its structure based on countries and reorganizes according to industries, it is most likely pursuing a multinational strategy known as ________.

A) ethnocentrism
B) polycentrism
C) borderless organization
D) multidomestic organization
E) born global

Question 70

The focus on centralized management in global companies reflects a(n) __________ attitude.

A) ethnocentric
B) polycentric
C) multicentric
D) geocentric
E) sociocentric

Question 71

Borderless organizations __________.

A) reflect an ethnocentric attitude
B) reflect a polycentric attitude
C) arrange structures that reduce artificial geographical barriers
D) manage their global operations from a base in their home country
E) arrange structures that reduce artificial industry divisions

Question 72

Borderless organizations approach global business with a(n) __________ attitude.

A) ethnocentric
B) polycentric
C) multicentric
D) geocentric
E) sociocentric

Question 73

Which of the following is a trading alliance of Southeast Asian nations?

A) NAFTA
B) MERCOSUR
C) APEC
D) ASEAN
E) FTAA

Question 74

Which of the following is an MNC that tailors marketing strategies to the host country's unique characteristics?

A) borderless organization
B) global company
C) multidomestic corporation
D) transnational organization
E) strategic alliance

Question 75

Which of the following is a multilateral trading system formed in 1995?

A) WTO
B) GATT
C) IMF
D) ASEAN
E) NAFTA

Question 76

Transnational organizations are focused on ________.

A) increasing efficiency
B) developing INVs
C) reinforcing artificial divisions
D) maintaining geographical boundaries
E) eliminating industry divisions

Question 77

Multidomestic corporations ________.

A) maintain operations in multiple counties but do not allow managers in each country to make their own decisions
B) utilize ethnocentric attitudes in financial decisions but favour polycentric views in human resources issues
C) decentralize management decision-making to local countries
D) follow the tastes, preferences, and values of the home country
E) eliminate structural divisions that impose artificial geographical barriers

Question 78

Transnational organizations are also known as ________.

A) ethnocentric organizations
B) polycentric organizations
C) borderless organizations
D) multidomestic organizations
E) global organizations

Question 79

The WTO is a global organization that evolved from __________.

A) NAFTA
B) GATT
C) the Maastricht Treaty
D) European Coal and Steel Community
E) EEC

Question 80

Which of the following types of multinational corporations reflects the geocentric attitude?

A) multidomestic corporation
B) transnational organization
C) global company
D) regional organization
E) strategic alliance