Question 1

Both Honda and Toyota have plants in the U.S.that use American labor.This example is an illustration of Honda and Toyota practicing

Accepted Answer

The practice of establishing a plant in a foreign country that uses local labor is called direct investment. In this case, Honda and Toyota have established plants in the US and are using American labor which falls under the category of direct investment.

Question 2

As a general rule, __________ seems to work best when the consumer market target for the product is alike across countries and cultures - that is, consumers share the same desires, needs, and use for the product.

Accepted Answer

Product extension involves offering the same product in multiple countries without any significant changes or adaptations. This strategy is most effective when consumers in different countries share the same wants, needs, and usage patterns for the product, making the standardized product appealing to them.

Question 3

The __________ arrangement between Ericsson, a Swedish telecommunications firm, and CGCT, a French switch maker, enabled them together to beat out AT&T for a $100 million French contract.

Accepted Answer

The arrangement between Ericsson and CGCT is a joint venture as they have come together to bid for a contract. Franchising, licensing, direct investment, and exporting involve a single party conducting business activities in a foreign market, whereas joint venture involves two or more parties coming together to form a separate entity for conducting a business activity.

Question 4

A joint venture refers to

Accepted Answer

A joint venture refers to when two or more firms, often from different countries, come together to form a new business entity. In this case, a foreign company and a local firm invest together to create a local business. Option A refers to licensing, Option B refers to outsourcing or contract manufacturing, Option D refers to direct and indirect exporting, and Option E refers to using an intermediary for exporting.

Question 5

The company that makes Breathe-Right nasal strips sells the same product in other countries.This is an example of which type of international product strategy?

Accepted Answer

The company is selling the same product in different countries, indicating that it is using a product extension strategy. This involves extending the same product to new markets without making any modifications or adaptations.

Question 6

A global market-entry strategy in which a foreign company and a local firm invest together to create a local business in order to share ownership, control, and profits of the new company foreign company and a local firm invest together to create a local business, it is referred to as

Accepted Answer

Joint venture is a global market-entry strategy in which a foreign company and a local firm invest together to create a local business in order to share ownership, control, and profits of the new company. Licensing involves granting permission to a company in another country to produce and sell products or services, while direct exporting involves selling products or services directly to customers in another country. Local assembly and local manufacturing involve setting up production facilities in another country.

Question 7

FIGURE 7-8 
-According to Figure 7-8 above, cell "D" refers to which type of product and promotion strategy?

Accepted Answer

Cell "D" in Figure 7-8 refers to the dual adaptation strategy, which involves adapting both the product and the promotion strategy for a specific market.

Question 8

KFC in Japan altered the sweetness of its coleslaw to appeal to Japanese tastes.This is an example of which type of international product strategy?

Accepted Answer

Product adaptation involves modifying a product to meet the unique needs and preferences of a particular market. In this case, KFC adapted its coleslaw recipe to be less sweet to better suit Japanese tastes.

Question 9

FIGURE 7-7 
-When Nestlé actually owns a subsidiary or division in a foreign country, such as when it established its own ice cream manufacturing operation in China (see Figure 7-7 above), this global market entry strategy is known as __________ and represents the greatest commitment a company can make.

Accepted Answer

Direct investment is the strategy in which a company establishes its own subsidiary or division in a foreign country, representing the greatest commitment a company can make. This is the case with Nestlé in China, where it established its own ice cream manufacturing operation. Licensing involves granting another company the right to use your intellectual property in exchange for royalties or other compensation. Local assembly involves importing components and assembling products locally, while local manufacturing involves setting up a manufacturing facility in a foreign country. A joint venture involves partnering with another company to jointly own and operate a business in a foreign country.

Question 10

Joint venture refers to

Accepted Answer

Joint venture refers to a global market-entry strategy in which a foreign company and a local firm invest together to create a local business in order to share ownership, control, and profits of the new company. This option best describes the concept of a joint venture. The other options refer to different global marketing strategies.

Question 11

Frito-Lay produces and markets potato chips in Russia that have seafood-flavor.This is an example of

Accepted Answer

Frito-Lay adapting their potato chips to have a seafood flavor specifically for the Russian market shows product adaptation. The company is modifying their existing product to better suit the tastes and preferences of a specific market.

Question 12

FIGURE 7-8 
-According to Figure 7-8 above, cell "A" refers to which type of product and promotion strategy?

Accepted Answer

The product extension strategy involves selling the same product with the same promotional strategy in different markets, which is typically represented by cell "A" in such matrices.

Question 13

The product strategy of selling virtually the same product in other countries is referred to as

Accepted Answer

Product extension refers to the strategy of selling virtually the same product in different countries, without making significant adaptations to the product to suit local tastes or preferences. This approach is often used for products that have a universal appeal, and where cost savings can be achieved through economies of scale in production and distribution.

Question 14

A global market-entry strategy that entails a domestic firm actually investing in and owning a foreign subsidiary or division, is referred to as

Accepted Answer

Direct investment involves a domestic firm investing in and owning a foreign subsidiary or division. This is a more involved and risky market-entry strategy, but it offers greater control and potential for long-term profitability.

Question 15

FIGURE 7-8 
-173 According to Figure 7-8 above, cell "C" refers to which type of product and promotion strategy?

Accepted Answer

The answer of FIGURE 7-8 
-173 According to Figure 7-8...

Question 16

Coca-Cola, Gillette razors, and Wrigley's gum are virtually selling the same product in other countries.This is an example of which type of international product strategy?

Accepted Answer

This is an example of product extension, where the company offers the same product in multiple markets without making significant changes to the product. In this case, Coca-Cola, Gillette razors, and Wrigley's gum are all offering their core products globally without customization or adaptation.

Question 17

Changing a product in some way to make it more appropriate for a country's climate or preferences is an example of which type of product strategy?

Accepted Answer

Product adaptation involves changing a product in some way to make it more appropriate for a country's climate or preferences. Product extension refers to adding new features or variations to an existing product, while product customization involves allowing customers to modify a product to meet their individual needs. Product invention refers to creating a new product from scratch, and product integration involves combining multiple products or services into a single offering.

Question 18

PepsiCo and __________ entered into a joint venture to market Frito-Lay's, Cheetos, Ruffles, Doritos, and other snacks in Israel.

Accepted Answer

The Strauss Group is an Israeli food and beverage company, making it the most likely partner for PepsiCo in a joint venture to market snacks in Israel. Ericsson is a Swedish telecommunications company, General Mills is a American food company, Hebrew National is a Jewish-American meat company, and CGCT is not a known company acronym.

Question 19

FIGURE 7-8 
-According to Figure 7-8 above, cell "B" refers to which type of product and promotion strategy?

Accepted Answer

Cell "B" refers to a product adaptation strategy, where the product is adapted to better suit local market preferences and needs, and a standard promotion strategy is used. This can be seen by the "Product adapted or modified" label in the cell and the absence of any changes or adaptations to the promotion strategy listed.

Question 20

FIGURE 7-8 
-According to Figure 7-8 above, cell "E" refers to which type of product and promotion strategy?

Accepted Answer

The answer of FIGURE 7-8 
-According to Figure 7-8 above,...

Quiz 7: Understanding and Reaching Global Consumers and Markets