Question 1

In an industry that is, or is rapidly becoming global, the riskiest possible posture is to
A) become a global competitor.
B) remain a domestic competitor.
C) remain a global competitor.
D) expand beyond the role of domestic competitor.
E) none of the above

Accepted Answer

In an industry that is, or is rapidly becoming global, remaining a domestic competitor is the riskiest possible posture. This is because competition from global competitors is likely to intensify, making it difficult for domestic competitors to survive or thrive. Global competitors have access to wider markets, economies of scale, and diverse resources, which put them in a better position to compete effectively. Therefore, it is essential for companies to expand their horizons and become global competitors to stay ahead in the industry.

Question 2

Mass communication and high technology have ________ in diverse cultures worldwide.
A) created similar patterns of consumption
B) resulted in highly individualized patterns of consumption
C) rendered patterns of consumption identical
D) had little to no effect on patterns of consumption
E) ignored patterns of consumption

Accepted Answer

Mass communication and high technology have led to the creation of similar patterns of consumption in diverse cultures worldwide, as people are exposed to similar media and advertising.

Question 3

Strengths of competitors in foreign lands are often ________, and weaknesses are often ________.
A) overestimated; overestimated
B) overestimated; underestimated
C) underestimated; underestimated
D) underestimated; overestimated
E) none of the above

Accepted Answer

It is common for companies to underestimate the weaknesses of competitors in foreign lands due to cultural and market differences. At the same time, they may overestimate their strengths based on reputation or past success. Therefore, D is the best answer.

Question 4

The ________ opportunities and threats that face a multinational corporation are almost limitless.
A) social
B) cultural
C) environmental
D) political
E) all of the above

Accepted Answer

A multinational corporation operates in multiple countries, making it subject to social, cultural, environmental, and political factors in each of those locations. The opportunities and threats arising from each of these factors can be extensive and varied, making it essential for the corporation to have a comprehensive understanding of the overall business environment. Therefore, option E, "all of the above", is the best choice.

Question 5

________ can enable firms to learn the technology, culture, and business practices of other people and to make contacts with potential customers, suppliers, creditors, and distributors in foreign countries.
A) Economies of scale
B) Joint ventures
C) Low-cost production facilities
D) Reduced tariffs
E) Domestic operations

Accepted Answer

Joint ventures are partnerships between two or more companies to share resources, knowledge, and profits in an international market. Joint ventures can provide an opportunity for companies to learn the technology, culture, and business practices of other people and to make contacts with potential customers, suppliers, creditors, and distributors in foreign countries.

Question 6

Most economists argue that protectionism ________ the world economy because it ________ trade among countries.
A) helps; inhibits
B) helps; encourages
C) harms; inhibits
D) harms; encourages
E) doesn't impact; doesn't affect

Accepted Answer

Most economists believe that protectionism harms the world economy because it inhibits trade among countries. Protectionist policies, such as tariffs and quotas, make imports more expensive, which can reduce demand and limit competition. This can lead to inefficiencies, reduced productivity, and higher consumer prices. In contrast, free trade promotes competition, innovation, and specialization, leading to greater efficiency and growth.

Question 7

Multinational corporations face unique and diverse risks, which include all of the following EXCEPT
A) favorable foreign court interpretations of contracts and agreements.
B) currency losses through exchange rate fluctuations.
C) social/political disturbances.
D) import/export restrictions.
E) tariffs.

Accepted Answer

Multinational corporations do not face the risk of favorable foreign court interpretations of contracts and agreements. However, they do face risks such as currency losses through exchange rate fluctuations, social/political disturbances, import/export restrictions, and tariffs.

Question 8

The U.S. government's OPIC
A) offers insurance to offset some risks of doing business internationally.
B) provides insurance to eliminate all of the risks of doing business internationally.
C) gives informational seminars about the risks associated with doing business internationally.
D) requires that paperwork be filed by U.S. companies desiring to do business internationally.
E) discourages foreign companies from doing business in the United States.

Accepted Answer

The Overseas Private Investment Corporation (OPIC) offers insurance to offset some risks of doing business internationally, such as political risks and currency fluctuations. However, it does not eliminate all risks, and companies are still responsible for filing paperwork and complying with regulations in the countries where they do business. OPIC also does not discourage foreign companies from doing business in the United States.

Question 9

Which of the following is a potential advantage of conducting international operations?
A) Competitors in foreign markets may not exist, or competition may be less intense than in domestic markets.
B) Dealing with two or more monetary systems can complicate international business operations.
C) Differing language, culture, and value systems can make communication difficult.
D) Gaining an understanding of regional organizations is difficult but is often required in doing business internationally.
E) All of the above

Accepted Answer

Conducting international operations can provide the advantage of having less competition or no competitors in foreign markets.

Question 10

The various opportunities and threats that face multinational corporations are almost limitless, and the number and complexity of these factors ________ the number of products and the number of geographic areas served.
A) decrease dramatically with
B) drastically increase with
C) drop slightly with
D) are constant despite
E) are unaffected by

Accepted Answer

The sentence suggests that the number and complexity of opportunities and threats faced by multinational corporations are directly related to the number of products and geographic areas served. Therefore, it can be inferred that as the number of products and geographic areas served increases, the number and complexity of opportunities and threats also increase. Option B best reflects this inference.

Question 11

A firm's power and prestige in domestic markets may be significantly enhanced if the firm competes globally
A) which can translate into improved negotiating power among important groups.
B) though this rarely results in a practical advantage.
C) but this can hurt its bargaining power with suppliers and distributors.
D) yet this does nothing to improve its position with creditors.
E) which can alienate the firm from its domestic creditors, suppliers, and distributors.

Accepted Answer

Competing globally can increase a firm's power and prestige, which can lead to improved negotiating power with important groups such as suppliers, distributors, and creditors.

Question 12

Communication between domestic headquarters and overseas operations is often made difficult by
A) geographic distance.
B) cultural differences.
C) variations in business practices.
D) national differences.
E) all of the above

Accepted Answer

All of the above factors can create difficulties in communication between domestic headquarters and overseas operations. Geographic distance can result in time zone differences and limitations on in-person meetings. Cultural differences can lead to misunderstandings and miscommunications when it comes to language, customs, and values. Variations in business practices can cause confusion and disagreement over how to conduct operations. National differences such as legal requirements and regulations can also create challenges.

Question 13

Which of the following statements is NOT true?
A) America's economy is becoming much less American.
B) A world economy and monetary system are emerging.
C) Corporations in every corner of the globe are taking advantage of the opportunity to obtain customers globally.
D) Markets are shifting slowly and in many cases diverging in tastes, trends, and prices.
E) Innovative transport systems are accelerating the transfer of technology.

Accepted Answer

The answer of Which of the following statements is NOT...

Question 14

The average level of union membership across the whole of the European Union, weighted by the numbers employed in the different member states, is ________ percent compared to about ________ percent in the USA.
A) 11; 23
B) 15; 44
C) 23; 11
D) 51; 26
E) 70; 30

Accepted Answer

The average level of union membership in the European Union is approximately 23 percent, while in the USA it is about 11 percent.

Question 15

In 2012, ________ African countries held democratic elections.
A) 3
B) 13
C) 23
D) 31
E) 43

Accepted Answer

In 2012, 23 African countries held democratic elections, reflecting a trend towards increased democratic processes on the continent during that period.

Question 16

Organizations that conduct business operations across national borders are called
A) protectionists.
B) national firms.
C) multinational corporations.
D) domestic companies.
E) all of the above.

Accepted Answer

Multinational corporations conduct business operations across national borders, whereas the other options do not necessarily involve international operations.

Question 17

The strategic-management process for multinational firms is ________ for purely domestic firms, and the process is ________ for international firms.
A) conceptually the same as; more simple
B) conceptually the same as; more complex
C) conceptually different than; more simple
D) conceptually different than; more complex
E) conceptually the same; less important

Accepted Answer

The strategic-management process is conceptually the same for both multinational and domestic firms, but it is more complex for international firms due to additional factors like diverse markets, regulations, and cultural differences.

Question 18

All of the following are potential disadvantages to initiating, continuing, or expanding business across national borders EXCEPT
A) firms confront different social, cultural, and political forces when doing business internationally, which can make communication in the firm difficult.
B) keeping informed about the number and nature of competitors is more difficult when doing business internationally.
C) foreign operations can absorb excess capacity, reduce unit costs, and spread economic risks over a wider number of markets.
D) dealing with two or more monetary systems can complicate international business operations.
E) foreign operations could be seized by nationalistic forces.

Accepted Answer

The statement in option C highlights potential advantages of initiating, continuing or expanding business across national borders, rather than a disadvantage. The other options explain potential challenges and difficulties with international business operations.

Question 19

________ countries are market leaders in labor-intensive industries and ________ offers abundant natural resources and rapidly developing markets.
A) East Asian; Brazil
B) South American; Germany
C) East Asian; Germany
D) South American; Brazil
E) European; Japan

Accepted Answer

The statement indicates that the market leaders in labor-intensive industries are in East Asian countries, and that there are abundant natural resources and rapidly developing markets in Brazil. Choice A accurately identifies East Asian countries and Brazil as the best combination of options.

Question 20

All of the following are potential advantages to initiating, continuing, and/or expanding international operations EXCEPT
A) firms can gain new customers for their products.
B) foreign operations can absorb excess capacity, reduce unit costs, and spread economic risks over a wider number of markets.
C) foreign operations can allow firms to establish low-cost production facilities in locations close to raw materials and/or cheap labor.
D) foreign operations could be seized by nationalistic factions.
E) foreign operations may result in reduced tariffs, lower taxes, and favorable political treatment.

Accepted Answer

The potential disadvantage of foreign operations being seized by nationalistic factions is not listed as a potential advantage.

Quiz 11: Global and International Issues

In an industry that is, or is rapidly becoming global, the riskiest possible posture is to

Mass communication and high technology have ________ in diverse cultures worldwide.

Strengths of competitors in foreign lands are often , and weaknesses are often .

The ________ opportunities and threats that face a multinational corporation are almost limitless.

________ can enable firms to learn the technology, culture, and business practices of other people and to make contacts with potential customers, suppliers, creditors, and distributors in foreign countries.

Most economists argue that protectionism the world economy because it trade among countries.

Multinational corporations face unique and diverse risks, which include all of the following EXCEPT

The U.S. government's OPIC

Which of the following is a potential advantage of conducting international operations?

The various opportunities and threats that face multinational corporations are almost limitless, and the number and complexity of these factors ________ the number of products and the number of geographic areas served.

A firm's power and prestige in domestic markets may be significantly enhanced if the firm competes globally

Communication between domestic headquarters and overseas operations is often made difficult by

Which of the following statements is NOT true?

The average level of union membership across the whole of the European Union, weighted by the numbers employed in the different member states, is percent compared to about percent in the USA.

In 2012, ________ African countries held democratic elections.

Organizations that conduct business operations across national borders are called

The strategic-management process for multinational firms is for purely domestic firms, and the process is for international firms.

All of the following are potential disadvantages to initiating, continuing, or expanding business across national borders EXCEPT

countries are market leaders in labor-intensive industries and offers abundant natural resources and rapidly developing markets.

All of the following are potential advantages to initiating, continuing, and/or expanding international operations EXCEPT