Deck 5: Developing a Global Vision

Question 1

If a country's currency appreciates,more of that currency will be needed to buy another country's currency.

Answer 1

False
If a country's currency appreciates,less of that currency is needed to buy another country's currency.

Question 2

Even though it is not actively involved in global marketing,Hennessey Enterprises,a U.S.-based business,agreed to sell two thousand of its stress-reducing products to a distribution company in Norway.This would be an example of direct investment.

Answer 2

False
This is an example of exporting.

Question 3

The Group of Twenty is the largest free trade agreement in the world.

Answer 3

False
The Group of Twenty is a forum for international economic development that promotes discussion between industrial and emerging-market countries on key issues in the global economy.

Question 4

The U.S.government limits the amount of sugar cane that is imported into the country.This is an example of a tariff.

Question 5

Global trade has climbed to about $200 billion a year.

Question 6

According to research done by the World Bank,countries with the greatest amount of business regulation foster the strongest economies.

Question 7

In general,average family incomes are higher in more developed countries than in the less developed countries.

Question 8

Having a global vision means management recognizes and reacts to international marketing opportunities,uses effective global marketing strategies,and is aware of threats from foreign competitors in all markets.

Question 9

The same environmental factors that operate in the domestic market also exist internationally.These factors (culture,economic,political structure and actions,demographic makeup,and natural resources)should be examined regardless of the country.

Question 10

The European Union Commission and the courts have come under widespread criticism for "rubber-stamping" or approving most business deals involving U.S.multinationals.

Question 11

About 85 percent of U.S.companies export their products to other countries on a regular basis.

Question 12

The falling U.S.dollar makes the possibility of manufacturing in the United States more attractive than in the past.

Question 13

Globalization deserves credit for helping lift many nations out of poverty and for improving standards of living of low-wage families.

Question 14

NAFTA is the New American Foreign Trade Amendment,which allows for balanced trade with the European Union (EU).

Question 15

Global marketing standardization presumes that the markets throughout the world are becoming more alike.

Question 16

The price of one country's currency in terms of another country's currency is called the conversion price.

Question 17

While some countries have elements of both capitalism and socialism,most nations are at one political extreme or the other.

Question 18

Multinational companies typically begin the development of their global business with direct investment and continue using this strategy throughout the company's life span.

Question 19

The Uruguay Round of trade negotiations dramatically increased trade barriers worldwide.

Question 20

The U.S.government prohibits the importation of Havana cigars because of political differences with Cuba.This is an example of a boycott.

Question 21

The form of global organization that provides the highest potential for return on investment as well as the highest level of risk is contract manufacturing.

Question 22

H.J.Heinz,the ketchup company,gets over half of its revenue from international sales.This shows that:

A) U.S.citizens are using less ketchup
B) their market share should increase
C) Heinz needs to abandon the U.S.market
D) sales need to be increased domestically
E) adopting a global vision can pay off

Question 23

Marketers typically target lower-income consumers when they enter global markets.

Question 24

The primary reason large U.S.companies send U.S.jobs abroad is because labor costs are higher here in the United States.They are engaging in _____.

A) outsourcing
B) global trade
C) multinational employee searches
D) employee export
E) global employment

Question 25

Private-label manufacturing by a foreign country is called franchising.

Question 26

Which of the following factors make the possibility of manufacturing in the United States more attractive than in the past?

A) Wages in China are rising 10 to 15 percent a year.
B) In recent years,the value of the U.S.dollar has fallen against the Chinese yuan.
C) Shipping costs have risen dramatically across the globe.
D) All of the above.
E) None of the above.

Question 27

In the context of global marketing,product invention can be taken to mean either creating a new product for a market or drastically changing an existing product.

Question 28

Many people fear world trade because it:

A) will inevitably lead to inflation
B) will cause living standards to increase at a slower rate
C) causes some people to lose their jobs as production shifts abroad
D) has brought entire nations out of poverty
E) has increased per capita income for some countries

Question 29

All of the following statements about global marketing are true EXCEPT:

A) Marketing to target markets throughout the world has become an imperative for business.
B) Often a U.S.firm's toughest domestic competition comes from foreign companies.
C) Marketing managers must develop a global vision not only to recognize and react to international marketing opportunities but also to remain competitive at home.
D) Adopting a global vision can be lucrative for a company,and global marketing can offset weak domestic performance.
E) Foreign competitors have not gained significant market share in the U.S.

Question 30

Individuals and organizations utilizing a global vision to effectively market goods and services across the world are engaged in:

A) international selling schemes
B) borderless commerce
C) global marketing standardization
D) global logistics
E) global marketing

Question 31

Licensing agreements reduce the risk for manufacturers and sometimes even remove the requirement for a manufacturer to produce its own product.

Question 32

The total market value of all final goods and services produced in a country for a given time period is called:

A) the exchange rate
B) gross domestic product (GDP)
C) the trade balance
D) gross national product (GNP)
E) gross operating surplus (GOS)

Question 33

U.S.-based Procter & Gamble and Italian-based Fater agreed to produce and market diapers for the European market.This is an example of a joint venture.

Question 34

Globalization:

A) relies on strong government regulations to keep down prices
B) promotes economic freedom and increases living standards
C) tends to dry up the flow of foreign capital in less developed countries
D) has made it easier for governments to abuse the freedom and property of their citizens
E) has kept wages low in developing countries around the world

Question 35

The rules,regulations,and habits used for brick-and-mortar stores tend to restrain and limit the success of those retailers engaged in e-commerce.

Question 36

Which of the following statements about the impact of international business on the U.S.economy is NOT true?

A) America exports over $1.7 trillion in goods and services each year.
B) Almost one-third of U.S.corporate profits come from international trade and foreign investment.
C) Every U.S.state has realized net employment gains directly attributed to foreign trade.
D) Exports create jobs for over 50 million Americans.
E) The U.S.exports about 20 percent of its industrial production.

Question 37

Global marketing research is not any more difficult than domestic marketing research.

Question 38

Sawyer Components manufactures high-cost,customized roller parts for paper mills and is expanding into China because of the opportunity for significant growth in this developing country.The owner uses effective global strategies and is aware of threats from foreign competitors.This illustrates that the owner has a global:

A) advantage
B) imperative
C) vision
D) outsource
E) introspection

Question 39

Suppose a Chinese firm makes computer chips at $4.00 per chip but sells the chips for $2.00 in American markets.American producers of computer chips cannot supply chips at the low rates that the Chinese firm is supplying them.The Chinese firm is engaging in dumping.

Question 40

Basketball is played nearly everywhere in the world and is an easily understood sport.The National Basketball Association (NBA)finals reached more than 600 million televisions in 195 countries.From this information,you should be able to infer that the NBA is:

A) developing international selling schemes
B) implementing standard international marketing
C) implementing global marketing standardization
D) supplementing its foreign vision
E) practicing global marketing

Question 41

Which of the following is a criticism of multinational corporations?

A) Multinationals sometimes support reactionary and oppressive regimes.
B) Multinationals require excessive employment information.
C) Multinationals often engage in countertrading.
D) Multinationalism is responsible for the transference of labor-intensive technology.
E) Multinationals do not do enough to standardize their marketing mixes.

Question 42

The Victorinox Swiss Army Knife is found all over the world.It is manufactured and marketed similarly to all consumers.Victorinox uses a(n):

A) ethnocentric strategy
B) global marketing standardization approach
C) synergistic approach to globalization
D) cultural marketing strategy
E) traditional approach to marketing

Question 43

Apple Inc.has partnerships with wireless carriers in Japan,Spain and a handful of other European countries.Apple Inc works with suppliers and retailers worldwide.This means that Apple is a:

A) multinational corporation
B) worldwide competitor
C) marketplace competitor
D) domestic corporation
E) foreign investor

Question 44

Otis Elevators has entered into a strategic alliance with a company in France from which it gets its elevator door systems.It has a similar agreement with a manufacturer in Japan that provides it with special motor drives.A manufacturer in Spain has worked closely with Otis to create small geared parts necessary for the manufacture of elevators.The component parts are assembled at its plant in the United States.Otis elevators can be found in buildings all over the world.Otis Elevators is an example of a(n):

A) cultural marketer
B) global trader
C) multinational corporation
D) exporting company
E) global enterprise

Question 45

When multinational firms enable individual subsidiaries to compete independently in domestic nations,they are engaged in:

A) global marketing standardization
B) multidomestic strategy
C) product extension
D) technological receptivity
E) marketing hegemony

Question 46

A soft drink manufacturer who was thinking of investing in a bottling plant in the Czech Republic should know the nation is proud of the fact it is among the world's biggest beer drinkers.Czechs consume an average of one-half liter of beer a day for every man,woman,and child in the country.The _____ environment of this country could very easily prevent the soft drink bottling company from succeeding.

A) demographic
B) economic
C) cultural
D) political
E) technological

Question 47

Defeet International creates its apparel in North Carolina and sells it domestically and abroad.The company is in which stage of global business?

A) Stage one
B) Stage two
C) Stage three
D) Stage four
E) Stage five

Question 48

A(n)_____ is a company that is heavily engaged in international trade and moves its resources,goods,services,and skills across national boundaries.

A) international facilitator
B) global trader
C) multinational corporation
D) exporting company
E) international merchant

Question 49

A business thinking of expanding into global markets needs to examine all of the following external environments EXCEPT:

A) culture
B) political structure and actions
C) its marketing mix
D) natural resources
E) demographic makeup

Question 50

Muslim countries are receptive to most Disney products,but they have asked Disney not to include Piglet when it sells its Winnie the Pooh characters because Muslims (as a part of their religious beliefs)contend that pork in any form is unclean.This is an example of a _____ factor that directly affects Disney's global operation.

A) political structure
B) cultural
C) technological
D) competitive
E) natural resource

Question 51

The Patton Awning company produces tents,tarps,awning,and other canvas products.The firm is in stage one of creating its global business.This means that they:

A) operate in one country and sell to others
B) have set up a foreign subsidiary
C) operate an entire line of business in another country
D) have top executives and core corporate functions in different countries
E) they operate in every country in the world

Question 52

In which stage do multicultural companies operate when they set up foreign subsidiaries to handle sales in one country?

A) Stage one
B) Stage two
C) Stage three
D) Stage four
E) Stage five

Question 53

Central to any society is a common set of values shared by its citizens that determines what is socially acceptable.Marketers refer to these values collectively as a country's:

A) ethical system
B) culture
C) ethnocentrism
D) national personality
E) socialization

Question 54

When European demand for a certain solvent declined,Dow Chemical instructed its German plant to switch to manufacturing a chemical that had been imported from Louisiana and Texas.Dow Chemical would be best described as a(n):

A) global enterprise
B) global trader
C) cultural marketer
D) exporting company
E) multinational corporation

Question 55

Which of the following statements about multinational firms is true?

A) Multinationals typically do not change their methods of reaching their global markets if they are successful with their initial strategy.
B) Multinationals are defined as companies heavily engaged in exporting and importing.
C) All multinationals must enter the fourth stage of globalization before they are fully internationalized.
D) Multinationals often develop their global businesses in stages.
E) The five stages of globalization closely mirror the five stages of the product life cycle.

Question 56

A company that is capital-intensive:

A) has an altered fiscal strategy for overseas operations
B) spends more on equipment than on labor
C) makes better use of benchmarking than other types of business
D) creates employment monopolies
E) must engage in countertrading due to restrictive foreign legislature

Question 57

With a _____,a firm produces standardized products to be sold the same way all over the world.

A) traditional marketing strategy
B) global marketing standardization approach
C) product extension approach
D) culturally based marketing strategy
E) synergistic approach to marketing

Question 58

Suppose three months ago the dollar price of a yen was $0.012.Today the dollar price of one yen is $0.018.If you are in the market for a brand new Honda automobile today,you will find that:

A) the price of the auto will be much less than it was three months ago
B) you will have trouble purchasing an auto because the dealership cannot keep up with the high demand
C) it will be impossible to obtain financing for the new auto
D) you will have to pay more for the auto than you would have paid three months ago
E) the trade-in value of your old vehicle will be much less than it would have been three months ago

Question 59

Cooley Manufacturing is a multinational company selling plumbing components around the world.This company has progressed to the point that it operates an entire of line of business in several other countries.Which stage of multinational business does this represent?

A) Stage one
B) Stage two
C) Stage three
D) Stage four
E) Stage five

Question 60

Global marketing standardization:

A) is becoming less popular with the large multinationals
B) encourages product,packaging,and advertising variations for each nation or local market
C) actually raises production costs
D) presumes markets throughout the world are becoming more alike
E) is more popular with consumer products than with industrial goods

Question 61

_____ are trade alliances in which several countries agree to work together to form a common trade area that enhances trade opportunities among those countries.

A) Boycotts
B) Regional unifications
C) Market groupings
D) Free trade nations
E) Expropriation members

Question 62

With respect to global business,MFN stands for:

A) multi-functional norm
B) multinational foreign network
C) main foreign network
D) most favored nation
E) multi-foreign nation

Question 63

A(n)_____ is a law that compels a company earning foreign exchange from its exports to sell it to a control agency,usually a central bank.

A) tariff
B) quota
C) fiscal prerequisite
D) exchange control
E) transfer barrier

Question 64

When IKEA,the Swedish home furnishings retailer,first entered the Japanese market,it failed.It was more successful in its second try because it was aware of the need to adapt its furnishings to fit the smaller Japanese homes.The _____ environment had the greatest influence on IKEA's first failure in Japan.

A) demographic
B) economic
C) cultural
D) political
E) technological

Question 65

Consumers purchasing an automobile in Hong Kong must pay a 100 percent tax on it.This tax is imposed by the government on all automobiles entering the country and is called a(n):

A) tariff
B) quota
C) license
D) boycott
E) exchange control

Question 66

An exclusion of all products from certain countries or companies by a government or group is called a(n):

A) expropriation
B) quota
C) tariff
D) exchange control
E) boycott

Question 67

_____ is a trade agreement that includes Argentina,Bolivia,Brazil,Chile,Columbia,Ecuador,Paraguay,Peru,and Uruguay.This agreement eliminated the tariffs among these trading partners.

A) NAFTA
B) Maastricht
C) WTO
D) GATT
E) Mercosur

Question 68

A tax levied on the goods entering a country is called a(n):

A) license
B) quota
C) boycott
D) exchange control
E) tariff

Question 69

Several Arab nations refuse to allow Coca-Cola products to be sold within their borders because of the company's distributorships in Israel.This is an example of a:

A) transfer limit
B) quota
C) tariff
D) exchange control
E) boycott

Question 70

Which of the following statements about the political environment is true?

A) A recession is part of the political environment.
B) A country is either socialistic or capitalistic,but never both.
C) The countries with the least across-the-board regulations and political structures foster the strongest economies.
D) The European Union is purely an economic arrangement and has no political impact on marketing.
E) All of these statements about the political environment are true.

Question 71

Since 1953,the United States has limited the amount of raw peanuts that can be imported to 1.7 million pounds a year.This is only about one-tenth of 1 percent of all domestic edible peanut consumption in the United States.This limitation is an example of a(n):

A) natural resource barrier
B) quota
C) tariff
D) exchange control
E) boycott

Question 72

Negotiations (such as GATT or the Uruguay Round)between countries that are made to stimulate global exchange and remove barriers are called _____ agreements.

A) trade
B) joint venture
C) CRM
D) exchange
E) licensing

Question 73

Which of the following is an important cultural factor that should be considered by global marketers?

A) Competitive synergy
B) Language
C) Natural resources
D) Technology sensitivity
E) Level of economic development

Question 74

The fact that Russia's inflation rate has increased 15.1 percent since May of 2007 would be an important _____ factor for a company that wanted to do business in that country.

A) legal
B) economic
C) culture
D) technological
E) natural

Question 75

Compared to India,China:

A) is a world leader in software
B) has extremely poor logistics
C) has developed world-class information-technology services
D) has a very low level of income disparity
E) is much stronger in mass manufacturing

Question 76

When a company or industry is taken over by the government,it has been:

A) unionized
B) boycotted
C) exchanged
D) patronized
E) nationalized

Question 77

A(n)_____ is a limit on the amount of a specific product that can enter a country.

A) quota
B) tariff
C) boycott
D) exchange control
E) transfer limit

Question 78

A U.S.executive had no idea the Germans tend to be very risk-averse.When he arrived at a meeting in Berlin,he simply stressed the price of his firm's products without emphasizing their bottom-line benefits,promoting the company's strong service support,or guaranteeing their effectiveness.As a result,the multimillion dollar deal failed.The U.S.executive overlooked the importance of which environmental factor?

A) Culture
B) Demographics
C) Natural resources
D) Economic development
E) Political structure

Question 79

Who are the richest people in the world?

A) Americans
B) Chinese
C) British
D) French
E) Luxembourgers

Question 80

American firms should never try to do business in Europe in August because they will find that everyone has gone on vacation.Today,all European countries have laws requiring companies to provide employees with vacations of at least four to five weeks.This would be an important part of the European _____ environment that any multinational firm doing business there needs to be aware of.

A) cultural
B) political
C) economic
D) technological
E) natural