Chapter 8 MGMT

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The two general kinds of trade barriers are:
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a. nationalistic and geocentric barriers b. qualitative and quantitative barriers c. voluntary and involuntary barriers d. government import standards and industry import standards e. tariff barriers and nontariff barriers CORRECT
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The trade agreement that represented the most significant change to the regulations governing global trade during the 1990s was the:
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a. Maastricht Treaty of Europe b. General Agreement on Tariffs and Trade CORRECT c. North American Free Trade Agreement d. Asian Free Trade Arrangement e. Mercosur
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Which of the following represents the correct sequence for the phase model of globalization?
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a. exporting; strategic alliances; cooperative contracts; wholly owned affiliates b. exporting; cooperative contracts; wholly owned affiliates; strategic alliances c. home country sales; exporting; job ventures; strategic alliances, and direct investment d. exporting; wholly owned affiliates; cooperative contracts; strategic alliances e. exporting; cooperative contracts; strategic alliances; wholly owned affiliates CORRECT
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Two factors help determine the growth potential of foreign markets. They are foreign competition and:
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a. political stability b. purchasing power CORRECT c. creative differences d. communications and transportation systems e. product diffusion rate
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Hofstede’s research has shown there are:
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a. four factors upon which a company should base its decision to globalize b. two distinct methods for dealing with cultural differences–adaptation and continuation c. direct relationships existing between type of infrastructures and growth potential d. five consistent dimensions of cultural differences across countries CORRECT e. no cultural differences among nations in which Spanish is the national language
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An expatriate is someone who:
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a. is unhappy with his or her present residence b. desires to be employed in a country outside of his or her own c. believes strongly in nationalization d. claims dual citizenship e. lives and works outside of his or her own country CORRECT – E
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The evidence clearly shows that __________ is the most important factor in determining the success or failure of an international assignment.
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a. the amount of cross-cultural training provided to the expatriate b. the similarity of the foreign language to the expatriate’s native language c. the amount of language training provided to the expatriate d. how willing the expatriate was to accept the foreign assignment e. how well an expatriate’s spouse and family adjust to the foreign culture CORRECT
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Global business is defined as____.
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a. the buying and selling of goods and services to people from different countries CORRECT b. only involves companies with more than 50 employees c. includes any sale of goods and services d. refers to sales made to people from different cultures, different regions, and different nations e. is unregulated
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____ is a method of investment in which a company builds a new business or buys an existing business in a foreign country.
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a. A strategic alliance b. A global new venture c. Direct foreign investment CORRECT d. A joint venture e. Direct exporting
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In 2000, the United States imposed a tax on all steel imports in an effort to protect about 5,000 jobs. This tax is an example of a(n) ____.
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a. import duty b. tariff CORRECT c. voluntary import restraint d. financial boycott e. subsidy
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____ are long-term, low-interest loans, cash grants, and tax deductions used to develop and protect companies or special industries.
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a. Quotas b. Voluntary export restraints c. Tariffs d. Cooperative contracts e. Subsidies CORRECT
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The acronym GATT stands for the ____.
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a. Global Arrangement for Trade and Taxes b. Government Aid of Trade and Transactions c. Global Agreement on Temporal Trade d. Governing Agreement on Trade and Transactions e. General Agreement on Tariffs and Trade CORRECT – E
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One of the major questions that a company must typically answer about its future, once it has decided to go global is ____.
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a. To what extent should a company abide by global or regional trade agreements? b. How many additional employees will the company need? c. To what extent should the company standardize or adapt business procedures? CORRECT d. How many new shareholders will be influenced by global activities? e. Will the organization’s mission statement need to be changed?
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Historically, most companies have used the ____ to successfully enter foreign markets.
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a. market echo approach b. global new venture approach c. ripple approach d. phase model of globalization CORRECT e. guerrilla approach
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Fran Wilson Creative Cosmetics is a medium-sized U.S. company that sells 1.5 million tubes of its lipstick annually in Japan. It has no physical presence within the country beyond the fact its products are sold there. Fran Wilson Creative Cosmetics uses ____ to reach the Japanese market.
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a. exporting CORRECT b. direct investment c. licensing d. franchising e. a strategic alliance
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____ occurs when a company sells domestically produced products to customers in foreign countries.
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a. Licensing b. A joint venture c. Franchising d. Direct foreign investment e. Exporting CORRECT
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A(n) ____ is an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country.
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a. exporting agreement b. joint venture c. strategic alliance d. direct investment e. cooperative contract CORRECT
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____ are both examples of cooperative contracts.
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a. Direct investment and indirect investment b. Joint ventures and strategies alliances c. Direct exporting and indirect exporting d. Licensing and joint ventures e. Franchising and licensing CORRECT
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In terms of Hofstede’s cultural differences, the people who are described as happy-go-lucky and are people who are comfortable with an unstructured life and deal well with sudden changes. In terms of Hofstede’s cultural differences, these people have a ____.
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a. low degree of uncertainty avoidance CORRECT b. masculine culture c. high degree of uncertainty avoidance d. feminine culture e. culture based on equity
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Starbucks is expanding its global operations into South America in spite of the real probability of civil wars and terrorist activities in many of the continent’s nations. As Starbucks expands into South America, it must deal with ____.
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a. nationalistic equity b. infrastructure regulation c. political uncertainty CORRECT d. strategy risk e. economic uncertainty
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All global new ventures share two common factors. One is the bringing of a good or service to several different foreign markets at the same time. The other is ____.
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a. none of these CORRECT b. a mechanistic organizational culture c. the development of culturally-specific implementation policies d. the use of local adaptation strategy e. the ability to respond quickly and efficiently to any changes in the external environment
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The evidence clearly shows that ____ is the most important factor in determining the success or failure of an international assignment
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a. the amount of language training provided to the expatriate b. how willing the expatriate was to accept the foreign assignment c. how well an expatriate’s spouse and family adjust to the foreign culture CORRECT d. the similarity of the foreign language to the expatriate’s native language e. the amount of cross-cultural training provided to the expatriate
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The term ____ is used by Hofstede to describe the degree to which people in a country are uncomfortable with unstructured, ambiguous, unpredictable situations.
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a. power distance b. short-term/long-term orientation c. risk aversion d. masculinity e. uncertainty avoidance CORRECT
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According to Hofstede, when people in a culture are oriented to the present and seek immediate gratification, that culture is described as ____.
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a. feminine b. having a short-term orientation CORRECT c. masculine d. individualistic e. having a long-term orientation
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The ____ strategy of minimizing or adapting to the political risk inherent to global business makes use of joint ventures and collaborative contracts
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a. control b. offensive c. defensive d. avoidance e. cooperation CORRECT
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____ is the set of shared values and beliefs that affects the perceptions, decisions, and behavior of people from a particular country.
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a. National culture CORRECT b. National mindset c. Cultural diversity d. National diversity e. Cultural nationalization
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What are the two types of political risk that affect companies conducting global business?
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a. policy uncertainty and expropriation potential b. cultural strength and political risks c. infrastructure dynamism and political uncertainty d. political uncertainty and policy uncertainty CORRECT – D e. nationalism and economic uncertainty
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A country or region that has an attractive business climate for companies that want to go global has ____.
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a. a small youth population b. all of these c. a large population of unskilled workers d. an effective but cost-efficient place to build an office or manufacturing site CORRECT e. natural boundaries
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Which of the following factors helps a company determine the growth potential of a foreign market?
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a. purchasing power CORRECT b. land availability c. type of infrastructure d. natural boundaries e. political uncertainty
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Which of the following factors should be considered when choosing an office/manufacturing location in the Brazilian market for a U.S. company that operates cinemas and wants to open a chain of movie theatres there?
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a. work force quality b. exchange rates c. tariff and nontariff barriers d. the strategy of the movie theater chain e. all of these CORRECT

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