Deck 8: Global Marketing

Question 1

Exporting refers to a situation where a company maintains ownership of its plants, operational facilities, and offices in a foreign country in which it sells its products.

Answer 1

False

Question 2

The BRIC countries are Bolivia, Russia, Italy, and China.

Answer 2

False

Question 3

Firms would prefer to manufacture in a country that has a trade surplus, or a higher level of exports than imports.

Answer 3

True

Question 4

Glocalization refers to a global marketing strategy in which each of the four Ps is customized for each country.

Question 5

Russia lags behind most European countries in use of the Internet.

Question 6

Companies that engage in global marketing must continually monitor economic and social trends to protect their position within the market and adjust products and marketing strategies to meet the changing needs of global markets.

Question 7

The greater the wealth of a country, generally, the better the opportunity a firm will have in that particular country.

Question 8

Colin wants information about the infrastructure in the countries his company is planning to export to, so he should gather information about the transportation and communications capabilities in each country.

Question 9

The Big Mac Index is a measure of economic health in a country.

Question 10

In parts of Europe, including Belgium, Italy, Spain, Greece, and France, sales are allowed only twice a year, in January and June or July.

Question 11

There is only one global product strategy: to sell a product or service similar to that sold in the home country, but include minor adaptations.

Question 12

In a joint venture, the burden of ownership, control, and profits falls on the market entry firm.

Question 13

Brazil is characterized by strong upper and lower classes, but the middle class has declined in recent years.

Question 14

Among the various international trade agreements, the North American Free Trade Agreement represents the highest level of integration across individual nations.

Question 15

Increasing liberalization in the Chinese economy has prompted a large improvement in the country's Global Retail Development Index (GRDI).

Question 16

Global expansion often begins when a firm receives an order for its product from another country.

Question 17

Tariffs are intended to make imported goods less expensive and thus less competitive with domestic products.

Question 18

Entering into a global franchise agreement exposes a company to higher risk than if the company had entered into direct investment in the country.

Question 19

An effective global pricing strategy can be easily established by setting the same prices in every market around the world.

Question 20

India is one of the fastest-growing markets and has one of the youngest populations in the world.

Question 21

Today, many developed countries are experiencing ________ population growth.

A) slight
B) zero or negative
C) rapid
D) moderate
E) significant

Question 22

The components of global market assessment include all of the following except

A) ethnic analysis.
B) infrastructure and technological analysis.
C) analysis of government actions.
D) sociocultural analysis.
E) economic analysis.

Question 23

Chris is gathering information about the general economic environment in Nepal. In doing so, he will look for information about the general economic environment, market size and population growth rate, and

A) culture.
B) real income.
C) airport capabilities.
D) political status.
E) religious institutions.

Question 24

To determine the market potential for its particular product or service, a firm should use

A) GDP data.
B) unemployment data.
C) purchasing power parity data.
D) inflation data.
E) as many metrics as it can obtain.

Question 25

How has the population shift from rural to urban areas in India impacted the supply chain?

A) It has decreased the supply chain's carbon footprint and reduced pollution throughout.
B) It has reduced the number of hands that products must pass through to reach the rural populations.
C) It has increased the human development index.
D) It has increased competition for intellectual capital.
E) It has increased nonmaterial GDP output.

Question 26

Cory is working on a global marketing assessment team looking out well into the future to help determine the most attractive market areas around the world. He is evaluating market sizes and growth rates. Based on population growth rates in different regions, he should consider that

A) countries with high purchasing power today may not continue to show the same growth in the future.
B) the United States and Western Europe will have dramatic increases in population growth leading to overcrowding.
C) the middle class in India will continue to shrink as the rich get richer and the poor get poorer.
D) in places like India, urban population centers will become increasing unattractive and the rural areas will experience major growth in population.
E) the global population is expected to grow at staggering rates indefinitely.

Question 27

When considering global marketing opportunities in Bangladesh, Tom asked the question, "How will we get it there?" Tom is concerned about ________ capabilities in Bangladesh.

A) production capacity
B) pricing
C) advertising
D) infrastructure
E) cultural

Question 28

Manufacturers would prefer to produce in a country with a trade ________, because it signals a greater opportunity to export products to more markets.

A) surplus
B) deficit
C) discrepancy
D) bonus
E) balance

Question 29

The most common measure of market potential of an economy is a country's

A) GNI.
B) GDP.
C) PPP.
D) CPI.
E) APR.

Question 30

According to purchasing power parity theory, if ________ is(are) in equilibrium, products will cost the same in each country.

A) imports and exports
B) consumer spending
C) interest rates
D) domestic products
E) exchange rates

Question 31

Gross national income consists of GDP

A) minus net consumer spending.
B) plus government spending on international trade.
C) minus purchasing power parity.
D) plus the net income earned from investments abroad (minus any payments made to nonresidents who contribute to the domestic economy).
E) plus gross domestic international investment.

Question 32

GDP is defined as

A) the value of a country's exports minus its imports.
B) the difference between two country's exchange rates.
C) the market value of goods and services produced in a country in a year.
D) national income minus national taxes.
E) the gross purchasing power of domestic goods and services plus international income.

Question 33

The Big Mac Index is a novel measure of

A) GDP.
B) purchasing power parity.
C) per capita GNI.
D) economic growth.
E) international trade surplus.

Question 34

A consumer products company produces inexpensive goods in underdeveloped markets, then repackages them as cost-effective innovations for Western buyers. This is an example of glocalization.

Question 35

Direct investment offers the firm complete control over its operations in the foreign country.

Question 36

Firms with global appeal can run global advertising campaigns and simply translate the wording in the advertisements and product labeling.

Question 37

Globalization refers to the processes by which goods, services, capital, people, information, and ideas

A) are onshored and offshored.
B) flow across national borders.
C) are integrated through IMF facilitation.
D) are similar in various markets.
E) affect corporate culture.

Question 38

Global distribution networks that involve middlemen, exporters, importers, and different transportation systems generally lower costs and prices for products.

Question 39

Economic measures like GDP and GNI do not fully account for a country's economic health because they measure only

A) material output.
B) international trade.
C) global expectations.
D) purchasing power parity.
E) poverty potential.

Question 40

Sophia owns a string of boutiques in Italy. As such she is allowed to have sales only twice a year, in January and June or July.

Question 41

Generally, firms entering foreign markets begin with

A) less risky strategies first.
B) direct investment.
C) importing.
D) decentralized production.
E) the riskiest, but most profitable endeavor.

Question 42

The marketers of an investment firm just developed a promotional campaign for a new financial service. In a print ad intended for its Chinese market, a representative from the firm is shown shaking hands with an Asian customer-a symbol that a business relationship based on trust and honor has been established. To convey this same message to its U.S. market, the U.S. print ad features a customer in an office formally signing a contract. Which of Hofstede's cultural dimensions accounts for this difference in the two ads?

A) power distance
B) indulgence
C) time orientation
D) uncertainty avoidance
E) individualism

Question 43

All of the following are major trade agreements affecting global marketing except

A) NAFTA.
B) EU.
C) GNI.
D) ASEAN.
E) CAFTA.

Question 44

A ________ limits the quantity of imported merchandise, thus minimizing competition faced by domestic products.

A) tariff
B) duty
C) trading bloc
D) trade agreement
E) quota

Question 45

Global expansion often begins with

A) franchising.
B) exporting of goods.
C) joint ventures.
D) direct investment.
E) strategic alliances.

Question 46

Global businesses often find it particularly difficult to understand the ________ of a country's culture.

A) symbols
B) underlying values
C) ceremonies
D) exhibited behavior
E) visible artifacts

Question 47

Tariffs protect domestic producers by

A) making imported products more expensive.
B) increasing brand recognition.
C) reducing the cost of production.
D) offering subsidies to exports.
E) avoiding regulation.

Question 48

All of the following are included in Hofstede's cultural dimensions except

A) power distance.
B) certainty assurance.
C) masculinity.
D) individualism.
E) time orientation.

Question 49

In most cases, countries use tariffs to reduce foreign competition, but tariffs are also used

A) to shorten supply chains.
B) as a response to perceived unfair trade practices.
C) to offer domestic discounts.
D) to stimulate consumer demand.
E) as a way to equalize quotas.

Question 50

When Ben evaluated the commercial infrastructure in Mauritius, he considered the island's

A) population control measures.
B) legal, banking, and regulatory systems.
C) retailing capabilities.
D) per capita income estimates.
E) climate and culture.

Question 51

When entering a foreign market, the least risky strategy is

A) franchising.
B) exporting.
C) joint venture.
D) direct investment.
E) strategic alliance.

Question 52

Marketers contemplating operations and trade with a specific country must consider whether or not the country belongs to a trading bloc. A trading bloc is a group of countries that have

A) established a formal agreement to manage trade activities.
B) agreed to use the same currency.
C) similar consumer purchasing patterns.
D) been segmented according to their geographic proximity.
E) been segmented based on shared cultural values.

Question 53

Culture affects

A) how consumers decide to make their purchases.
B) what consumers decide to purchase.
C) when consumers decide to make their purchases.
D) where consumers decide to make their purchases.
E) every aspect of consumers' purchase decisions.

Question 54

Chris is trying to determine what went gone wrong with the campaign he had planned in Latin America for his company's product. He narrowed the issues down to sociocultural factors, specifically

A) product uses and currency rates.
B) trade agreements and trading blocs.
C) potential tariffs and quotas.
D) visible artifacts and underlying values.
E) population distribution and logistics.

Question 55

Which of these trade agreements represents the highest level of integration among participating nations?

A) NAFTA
B) EU
C) GNI
D) ASEAN
E) CAFTA

Question 56

When the U.S. government determined the prices of solar panels imported from China were artificially low due to illegal subsidies, it imposed a ________ to help domestic firms compete.

A) comparative inflation rate
B) countertrade exchange
C) quota
D) tariff
E) currency exchange rate

Question 57

Geert Hofstede's cultural dimensions concept focuses on five dimensions of ________ in a country.

A) symbols
B) underlying values
C) buying patterns
D) personality
E) visible artifacts

Question 58

Changes in tariffs and quotas are

A) business actions stimulating imports.
B) corporate strategies designed to maximize profits.
C) government actions that reduce competition from international firms.
D) efforts to stimulate choices among government agencies.
E) a means of slowing outsourcing.

Question 59

As part of efforts to stimulate economic development in Africa, the Gates Foundation announced that it would provide cellular phones to farmer cooperatives. The Gates Foundation recognized that problems in ________ exist in many African markets.

A) transportation
B) communication
C) distribution
D) commerce
E) population

Question 60

When the value of the dollar declines in relation to other currencies, it benefits U.S. marketers who

A) export goods to other countries.
B) import goods from other countries.
C) engage in countertrade.
D) enforce import quotas.
E) outsource labor.

Question 61

Global pricing strategies should strive to be consistent with

A) offshore distribution facilities.
B) the cost of materials.
C) positioning strategies.
D) domestic pricing.
E) trade surplus guidelines.

Question 62

Of the five strategies for entering new markets, direct investment creates the

A) least investment cost.
B) greatest potential risk.
C) most franchisee control.
D) best opportunity for strong strategic alliances.
E) greatest coordination of efforts of global and local partners.

Question 63

The most important consideration when a firm chooses a global product strategy should be

A) opportunities for countertrade.
B) the effectiveness of the marketing team.
C) the needs of the target market.
D) the overall cost of the strategy.
E) WTO regulations.

Question 64

Many of the best-known American retailers, like Starbucks and McDonald's, have contractual agreements with another firm or individuals, allowing its businesses to operate overseas. These companies expanded globally using

A) franchising.
B) exporting.
C) joint ventures.
D) direct investment.
E) strategic alliances.

Question 65

Brand names can present a challenge for global marketers because of language differences. Meaning gets lost in translation. To avoid committing language faux pas with brand names, companies should

A) keep the brand name the same in all languages, regardless of meanings, as long as the brand logo and symbol are displayed prominently.
B) avoid the use of the brand name in advertising and focus on features and benefits.
C) translate advertising copy for the entire ad except for the brand name.
D) develop brand names that have no preexisting meaning in any known language.
E) adhere to the UN Convention on Naming Rights.

Question 66

Global marketers typically find distribution in developing countries is more complex because

A) they must go through many different types of distribution channels.
B) distribution is more heavily regulated in developing countries.
C) most consumers in developing countries live in densely populated cities.
D) the infrastructure is more advanced in most developing countries.
E) consumers in developing countries have very specific preferences.

Question 67

Graham had developed an extremely successful advertising and promotion campaign for a client in the United States. The client wanted to roll out the same campaign to markets worldwide, but Graham cautioned against doing this, most likely because

A) differences in languages, customs, and culture might make the campaign meaningless and ineffective in some markets.
B) copyright and intellectual property concerns prevented him from wanting to share his good ideas outside of the U.S. market.
C) he had not applied for or received international certification that was required for working outside the United States.
D) he was unfamiliar with the code of ethics for advertising in other countries.
E) he did not have the budget for a global rollout.

Question 68

India, like some other countries, may require entering firms to create ________ when expanding into their markets, limiting outsiders' control of businesses.

A) franchises
B) export promotions
C) joint ventures
D) direct investments
E) strategic alliances

Question 69

Domestic firms developing a global entry strategy might consider franchising. Before deciding on franchising as a strategy however, firms must understand the disadvantages. All of the following are disadvantages of franchising except​

A) the franchisor has limited control over the market operations in the foreign country.
B) the franchisee might end up becoming a competitor under a different name.
C) franchising limits profit potential for the parent firm.
D) franchising is the riskiest way to enter a foreign market.
E) the franchisor has to split the profits with the franchisee.

Question 70

When a firm pools its resources with that of a local firm to enter a new market, they create a(n)

A) franchise.
B) export promotion.
C) joint venture.
D) direct investment.
E) strategic alliance.

Question 71

Which of the following are the two components of a global marketing strategy?

A) understanding foreign currency fluctuations and developing products that can be priced accordingly
B) determining which target markets to pursue and developing a marketing mix to obtain a competitive advantage
C) understanding the supply chain and distribution networks in foreign markets
D) developing culturally appropriate advertising messages and cultivating "domestic" habits among foreign consumers
E) adapting to foreign regulations and targeting as many people as possible

Question 72

As noted in your text, global segmenting, targeting, and positioning are more complicated than domestic segmenting and positioning because of cultural nuances, significant subcultures within countries, and

A) currency differences.
B) antidiscrimination regulations prohibiting segmentation and targeting in developing countries.
C) differences in the way consumers see themselves and in the way they see products and services.
D) complications due to franchising issues.
E) the taxes imposed by some foreign countries on marketing activities.

Question 73

Global segmentation, targeting, and positioning (STP) are more complicated than local STP, in part because

A) consumers may view their roles differently in different countries.
B) there are fewer franchising opportunities in global markets.
C) global consumer markets are almost totally homogeneous, making segmentation difficult.
D) most governments have rules against targeting consumers.
E) positioning almost always fails when attempted in a foreign country.

Question 74

Celia's firm has developed a breakfast cereal and rather than compete in the U.S. market, she has decided instead to introduce the product in Europe, where she feels it will be innovative. Her advertising agency urged caution because

A) differences in language, customs, and culture complicate marketers' ability to communicate with customers in various countries.
B) print media are different in Europe, and it would be difficult to create a global campaign.
C) literacy rates are significantly lower in Europe, and print ads would be ineffective.
D) research indicates that Europeans do not eat breakfast as often as Americans.
E) domestic advertising agencies cannot earn commissions on advertising they place overseas.

Question 75

Tariffs, quotas, and currency exchange policies affect global

A) offshore product design.
B) pricing strategies.
C) advertising.
D) logistics.
E) promotion.

Question 76

Global marketers are under constant pressure to simplify distribution channels in order to

A) improve promotion efficiency.
B) reduce trade deficits.
C) afford tariffs.
D) meet trade agreement guidelines.
E) reduce costs.

Question 77

Which of the following statements regarding global segmentation, targeting, and positioning is true?

A) Companies must continually adjust products and marketing strategies to meet the changing needs of global markets.
B) Global segmentation, targeting, and positioning activities are far less complicated than the same activities in the domestic market.
C) When developing a global STP strategy, it is best to define segments by geography alone.
D) Segmentation, targeting, and positioning activities for global markets do not differ substantially from that of domestic markets.
E) The "golden rule" for global STP activities for firms is to never alter a firm's marketing mix to serve the needs of global markets.

Question 78

Gerald is assessing global entry strategies for his gourmet sandwich business. He does not want to take a lot of risk and he is willing to limit his control of international stores. Gerald will most likely use a(n) ________ strategy.

A) franchising
B) exporting
C) joint venture
D) direct investment
E) strategic alliance

Question 79

NCD Company wants to expand into the Mexican market. It has the financial resources, wants to control business operations, and has had considerable success marketing to Hispanics in the United States. NCD will likely use ________ to expand into the Mexican market.

A) franchising
B) exporting
C) a joint venture
D) direct investment
E) a strategic alliance

Question 80

Cultural nuances, subcultures, and consumers' different views of their roles in different countries can make ________ complicated.

A) purchasing power parity
B) segmentation, targeting, and positioning
C) trading bloc coordination
D) exchange control planning
E) reducing trade surpluses