International Management FINAL – Flashcards with Answers

Unlock all answers in this set

Unlock answers
question
T/F: An overseas operation that is totally owned and controlled by an MNC is a wholly owned subsidiary.
answer
TRUE
question
T/F:The primary reason for the use of licensing agreements is a desire by the MNC for total control over its products in overseas markets.
answer
FALSE
question
T/F:A joint venture is an agreement in which two or more partners own and control an overseas business.
answer
TRUE
question
T/F:A license is a structural arrangement in which domestic divisions are given worldwide responsibility for product groups.
answer
FALSE
question
T/F: A franchise is an agreement that allows one party to use an industrial property right in exchange for payment to the other party.
answer
FALSE
question
T/F: Franchising provides the franchisor with a new stream of income and the franchisee with a time-proven concept and products that can be quickly brought to market.
answer
TRUE
question
T/F:Companies in the mature stage of international business involvement are the most likely to adopt an international division structure
answer
FALSE
question
T/F: A disadvantage of the international division structure is that it separates a firm's domestic and international managers, which can result in two different camps with divergent objectives.
answer
TRUE
question
T/F: A structural arrangement in which domestic divisions are given worldwide responsibility for product groups is referred to as a global area division structure.
answer
FALSE
question
T/F: Firms that pursue a global product division structure typically have products that are in the maturity stage of the product life cycle.
answer
FALSE
question
T/F: One disadvantage of the global product division structure is the necessity of duplicating facilities and staff personnel within each division.
answer
TRUE
question
T/F: A structure under which global operations are organized on a geographic rather than a product orientation is referred to as a global area structure.
answer
TRUE
question
T/F: Companies that are in growing businesses and have broad product lines most often use a global area division structure.
answer
FALSE
question
T/F: An advantage of the global area division structure is that it allows the division manager to cater to the tastes of the local market and make rapid decisions to accommodate environmental changes.
answer
TRUE
question
T/F: An advantage of the global functional division structure is that only the CEO can be held accountable for the profits.
answer
FALSE
question
T/F: One of the main objectives in developing the structure for joint ventures is to help the partners address and effectively meld their different values and organizational preferences.
answer
TRUE
question
T/F: In most companies, mutual adjustment is achieved by assigning people to a specific project and having them meet face-to-face and work out a plan of action of designing the new product.
answer
TRUE
question
T/F: Formalization is an organizational characteristic that assigns individuals to specific, well-defined tasks.
answer
FALSE
question
T/F: Specialization is the use of defined structures and systems in decision-making, communicating and controlling.
answer
FALSE
question
T/F: Centralization is a management system in which important decisions are made at the top.
answer
TRUE
question
The primary reason for the use of _____ is a desire by the MNC for total control and the belief that managerial efficiency will be better without outside partners. A. Licensing agreements B. Franchising C. Wholly owned subsidiaries D. Joint ventures
answer
C. Wholly owned subsidiaries
question
This is an agreement in which two or more partners own and control an overseas business. A. Franchise B. Wholly owned subsidiary C. Licensing agreement D. Joint venture
answer
D. Joint venture
question
The equity joint venture: A. Is characterized by one group merely providing a service for another B. Involves a financial investment by the MNC in a business enterprise with a local partner C. Organizes worldwide operations based primarily on function and secondarily on product D. Provides the most benefits when the need for product specification or differentiation is high
answer
B. Involves a financial investment by the MNC in a business enterprise with a local partner
question
The nonequity venture: A. Is characterized by one group merely providing a service for another B. Provides the most benefits when the need for product specification or differentiation is high C. Involves a financial investment by the MNC in a business enterprise with a local partner D. Organizes worldwide operations based primarily on function and secondarily on product
answer
A. Is characterized by one group merely providing a service for another
question
The two types of joint ventures are: A. Equity and non-equity ventures B. Proprietary and public ventures C. Statutory and unofficial ventures D. External and internal ventures
answer
A. Equity and non-equity ventures
question
26. (p. 312) This is an agreement that allows one party to use an industrial property right in exchange for payment to the other party. A. Franchise B. Joint venture C. License D. Certificate of proprietary usage
answer
C. License
question
A _____ is a business arrangement under which one party allows another to operate an enterprise using its trademark, logo, product line and methods of operation in return for a fee. A. License B. Franchise C. Certificate of proprietary usage D. Joint venture
answer
B. Franchise
question
These agreements typically require payment of a fee upfront and then a percentage of the revenues. A. Franchise B. Wholly owned subsidiary C. Export D. Joint venture
answer
A. Franchise
question
Aircraft manufacturing fits which of the following globalization versus local responsiveness combination? A. High pressure for globalization, high pressure for local responsiveness B. High pressure for globalization, low pressure for local responsiveness C. Low pressure for globalization, low pressure for local responsiveness D. Low pressure for globalization, high pressure for local responsiveness
answer
B. High pressure for globalization, low pressure for local responsiveness
question
Clothing manufacturing fits which of the following globalization versus local responsiveness combination? A. Low pressure for globalization, low pressure for local responsiveness B. Low pressure for globalization, high pressure for local responsiveness C. High pressure for globalization, low pressure for local responsiveness D. High pressure for globalization, high pressure for local responsiveness
answer
B. Low pressure for globalization, high pressure for local responsiveness
question
A common first choice among manufacturing firms, especially those with technologically advanced products, would be to develop a(n): A. Domestic policy B. Export arrangement C. Cartel arrangement D. Import quota
answer
B. Export arrangement
question
In a company that has a narrow product line, the export manager usually reports directly to the head of: A. Purchasing B. Personnel C. Production D. Marketing
answer
D. Marketing
question
The structural arrangement that allows a company to develop an overall, unified approach to international operations and helps the firm develop a cadre of internationally experienced managers is an advantage of a(n): A. Mixed organization structure B. Global area division structure C. Global product division structure D. International division structure
answer
D. International division structure
question
34. (p. 317) Pressure by local foreign government for continued growth of international sales encourage on-site: A. Maintenance B. Supply and distribution operations C. Manufacturing operations D. Safety operations
answer
C. Manufacturing operations
question
A structural arrangement that handles all international operations out of a division created for this purpose is referred to as a(n): A. Worldwide organizational structure B. Global matrix structure C. International division structure D. Overseas network structure
answer
C. International division structure
question
Companies still in the development stages of international business involvement are most likely to adopt the: A. International division structure B. Global product division structure C. Global area division structure D. Global functional division structure
answer
A. International division structure
question
According to the text, all of the following types of companies are likely to adopt the international division structure except: A. Companies with limited geographic diversity B. Companies with a large number of executives with international expertise C. Companies still in the developmental stage of international business D. Companies with small international sales
answer
B. Companies with a large number of executives with international expertise
question
A structural arrangement in which domestic divisions are given worldwide responsibility for product groups is referred to as a(n): A. International division structure B. Global product division structure C. Global area division structure D. Global functional division structure
answer
B. Global product division structure
question
The products sold by firms that adopt a global product division structure are generally in the _____ stage of the product life cycle. A. Introduction B. Growth C. Maturity D. Decline
answer
B. Growth
question
Which of the following provides the most benefits when the need for product specification or differentiation is high? A. International division B. Global product division C. Global area division D. Global functional division
answer
B. Global product division
question
A structure under which global operations are organized on a geographic rather than a product basis is referred to as a(n): A. Global area division structure B. Global product division structure C. International division structure D. Global functional division structure
answer
A. Global area division structure
question
That division managers may pursue currently attractive geographic prospects for their products and neglect other areas with better long-term potential is a major drawback of the: A. International division structure B. Global product division structure C. Global area division structure D. Global functional division structure
answer
B. Global product division structure
question
Which of the following is an advantage of a global area division structure? A. The structural arrangement helps a firm manage a diverse product line B. The structural arrangement helps a firm cater to local needs in foreign markets C. The marketing, production and finance divisions of the firm can be coordinated on a product-by-product global basis D. The structural arrangement helps a firm develop an overall, unified approach to international markets
answer
B. The structural arrangement helps a firm cater to local needs in foreign markets
question
A global area division structure most often is used by companies that are in _____ businesses and have _____ product lines. A. Growing; broad B. Mature; narrow C. Growing; narrow D. Mature; broad
answer
B. Mature; narrow
question
The difficulty encountered in reconciling a product emphasis with a geographic orientation is the primary disadvantage of a(n): A. International division structure B. Global product division structure C. Global area division structure D. Global functional division structure
answer
C. Global area division structure
question
Which of the following organizes worldwide operations based primarily on function and secondarily on product? A. International division structure B. Global product division structure C. Global area division structure D. Global functional division structure
answer
D. Global functional division structure
question
A global functional division structure is used primarily by: A. Service companies B. Extractive companies C. Light manufacturing companies D. Heavy manufacturing companies
answer
B. Extractive companies
question
All of the following are advantages of the global functional division structure except: A. An emphasis on functional expertise B. A tight centralized control C. A relatively lean managerial staff D. The chief executive officer is held accountable for the profits
answer
D. The chief executive officer is held accountable for the profits
question
A structure that is a combination of a global product, an area or a functional arrangement is referred to as a(n) _____ organizational structure. A. Assimilated B. Transnational C. Mixed D. Team-based
answer
C. Mixed
question
A multinational structural arrangement that combines elements of function, product and geographic designs, while relying on a network arrangement to link worldwide subsidiaries is referred to as a: A. Transnational network structure B. Cross-cultural matrix structure C. Transnational divisional structure D. Cross-cultural network structure
answer
A. Transnational network structure
question
A _____ is designed to help MNCs take advantage of global economies of scale while also being responsive to local customer demands. A. Global matrix structure B. Transnational network structure C. Worldwide divisional structure D. Cross-cultural matrix structure
answer
B. Transnational network structure
question
At the center of the _____ are nodes, which are units charged with coordinating product, functional and geographic information. A. Cross-cultural matrix structure B. Worldwide divisional structure C. Transnational network structure D. Global product division structure
answer
C. Transnational network structure
question
Subsidiaries that are located anywhere in the world where they can benefit the organization are called: A. Chaebols B. Keiretsus C. Specialized subunits D. Dispersed subunits
answer
D. Dispersed subunits
question
Specialized operations are: A. Designed to tap specialized expertise or other resources in the company's worldwide subsidiaries B. Subsidiaries that are located anywhere in the world where they can benefit the organization C. Designed to take advantage of low factor costs, while others are responsible for providing information on new technologies or consumer trends D. Used to share information and resources throughout dispersed and specialized subunits
answer
A. Designed to tap specialized expertise or other resources in the company's worldwide subsidiaries
question
Interdependent relationships are: A. Designed to tap specialized expertise or other resources in the company's worldwide subsidiaries B. Subsidiaries that are located anywhere in the world where they can benefit the organization C. Used to share information and resources throughout the dispersed and specialized subunits D. Designed to take advantage of low factor costs, while others are responsible for providing information on new technologies or consumer trends
answer
C. Used to share information and resources throughout the dispersed and specialized subunits
question
In terms of cultural control in a global area division: A. It is treated like all other MNC structural divisions B. Local subsidiary culture is often the most important C. It is possible for some companies, but not always necessary D. Culture must support the shared decision making
answer
B. Local subsidiary culture is often the most important
question
In which of the following MNC structures are tight process bureaucratic controls used to maintain product quality and consistency? A. Transnational network structure B. Global area division C. Matrix structure D. Global product division
answer
D. Global product division
question
The decision-making control in which local units are given autonomy is characteristic of a(n): A. Global area division structure B. International division structure C. Global product division structure D. Transnational network structure
answer
A. Global area division structure
question
The output control in which profit responsibility is shared with product and geographic units is characteristic of a(n): A. Global area division structure B. International division structure C. Matrix structure D. Transnational network structure
answer
C. Matrix structure
question
Bureaucratic control is not very important in which type of multinational structure? A. Global product division structure B. Global area division structure C. Matrix structure D. International division structure
answer
C. Matrix structure
question
Which basic value is not common in Asian firms? A. Group B. Trust C. Confrontation D. Fluid
answer
C. Confrontation
question
Individuals who work for a company, usually via the Internet and move on to other employment when their assignment is done are known as: A. Purchasing agents B. Marketing managers C. International outsourcers D. Electronic freelancers
answer
D. Electronic freelancers
question
_____ is the use of defined structures and systems in decision-making, communicating and controlling. A. Formalization B. Specialization C. Concentration D. Interpretation
answer
A. Formalization
question
In a study of U.S. and Japanese firms in Taiwan, objective formalization was measured by: A. Use of informal controls B. The extent to which goals were vague and unspecified C. The number of different documents given to employees D. Use of culturally induced values in getting things done
answer
C. The number of different documents given to employees
question
As an organizational characteristic, _____ is the assigning of individuals to specific, well-defined tasks. A. Interpretation B. Concentration C. Formalization D. Specialization
answer
D. Specialization
question
Specialization in an international context can be classified into: A. Diagonal and vertical specialization B. Vertical and parallel specialization C. Horizontal and vertical specialization D. Diagonal and parallel specialization
answer
C. Horizontal and vertical specialization
question
The assignment of jobs so that individuals are given a particular function to perform and tend to stay within the confines of this area is referred to as: A. Diagonal specialization B. Parallel specialization C. Vertical specialization D. Horizontal specialization
answer
D. Horizontal specialization
question
The assignment of work to groups of departments where individuals are collectively responsible for performance is referred to as: A. Horizontal specialization B. Vertical specialization C. Lateral specialization D. Parallel specialization
answer
B. Vertical specialization
question
_____ is a management system in which important decisions are made at the top. A. Centralization B. Decentralization C. Horizontal specialization D. Vertical specialization
answer
A. Centralization
question
Pushing decision making down the line and getting the lower-level personnel involved is referred to as: A. Centralization B. Decentralization C. Horizontal specialization D. Vertical specialization
answer
B. Decentralization
question
T/F: Political risk is the likelihood that a multinational corporation's foreign investment will be constrained by a host government's policies.
answer
TRUE
question
T/F: Over the past decade and with the recent terrorist attacks on the U.S., political risk assessment has become less vital to MNCs.
answer
FALSE
question
T/F: China's decision regarding restrictions on foreign exchange transactions is a micro political risk because it affects all MNCs.
answer
FALSE
question
T/F: Micro political risk analysis is directed toward government policies and actions that influence selected sectors of the economy or specific foreign businesses.
answer
TRUE
question
T/F: China's decision regarding restrictions on foreign exchange transactions represents a macro political risk because it affects all MNCs.
answer
TRUE
question
T/F: Macro risk issues often take forms such as industry regulations, taxes of specific types of business activity and various restrictive local laws.
answer
FALSE
question
T/F: Firms that are at the greatest risk in regard to expropriation are in extractive, agricultural or infrastructural industries such as utilities and transportation because of the importance of these industries to the country.
answer
TRUE
question
T/F: Examples of ownership-control risks include tariffs on export and imports and well as restrictions on exports.
answer
FALSE
question
T/F: Operational risks result from government policies and procedures that directly constrain the management and performance of local operations.
answer
TRUE
question
T/F: In a conglomerate investment, the goods or services produced are not similar to those produced at home.
answer
TRUE
question
T/F: Conglomerate investments usually are rated as low risk, because foreign governments see them as providing fewer benefits to the MNC and greater benefits to the country than other investments.
answer
FALSE
question
T/F: Vertical investments run the risk of being taken over by government because they are export-oriented and governments like a business that helps it to generate foreign capital.
answer
TRUE
question
T/F: There are three sectors of economic activity: the primary sector, the secondary sector and the service sector.
answer
FALSE
question
T/F: Some MNCs attempt to manage political risk through a quantification process in which a range of variables are simultaneously analyzed to derive an overall rating of the degree of political risk in a given jurisdiction.
answer
TRUE
question
T/F: Protective and defensive techniques are designed to encourage the host government to actively participate in the management of the MNC.
answer
FALSE
question
T/F: Comprehensive political strategies are most important in stable policy environments
answer
FALSE
question
T/F: Local knowledge can be internalized primarily as a result of an MNC operating in that market.
answer
FALSE
question
T/F: In the context of international strategic alliances, value-claiming activities are competitive and distributive.
answer
TRUE
question
T/F: The most difficult cultural differences to manage in international strategic alliances are power distance and uncertainty avoidance.
answer
FALSE
question
T/F: Host government mandates that require foreign investors to partner with local state-owned firms or follow local-content rules may still have a positive impact on MNCs.
answer
TRUE
question
Which of the following is not a challenge of doing business in Russia? A. Corruption B. Red tape C. Strong faith in government policies D. Security concerns
answer
C. Strong faith in government policies
question
Not all MNCs are confident about international investment in countries with: A. Low labor costs B. Political unrest C. Emerging economies D. Cultural differences
answer
B. Political unrest
question
The following is not an example of risk factors for an MNC: A. Freezing the movement of assets out of the host country B. Limits on the remittance of profits or capital C. Devaluing the currency D. Complying with contractual terms of agreements
answer
D. Complying with contractual terms of agreements
question
_____ risk is the likelihood that a multinational corporation's foreign investment will be constrained by a host government's policies. A. Social B. Development C. Legal D. Political
answer
D. Political
question
Over the past decade political risk has become: A. An area closely watched by developing countries, but virtually ignored by developed countries B. A vital area for MNCs to assess and manage C. A much less pervasive and minor threat facing international management D. Virtually obsolete for international firms as a result of controls imposed by the UNO
answer
B. A vital area for MNCs to assess and manage
question
The following actions raise the political risk of doing business in China except: A. Interpretation of rules and regulations by officials B. Industrial piracy C. Pressure on the MNCs to do things in a particular way D. Concerns on safety and reliability of product quality
answer
D. Concerns on safety and reliability of product quality
question
_____ reviews major political decisions that are likely to affect all business conducted in a particular country. A. Macro political risk analysis B. Micro political risk analysis C. Standard political risk analysis D. Multidimensional political risk analysis
answer
A. Macro political risk analysis
question
China's decision regarding restrictions on foreign exchange transactions is a _____ political risk because it affects all MNCs. A. Micro B. Standard C. Macro D. Multidimensional
answer
C. Macro
question
In recent years _____ risk analysis has become of increasing concern to MNCs because of the growing number of countries that are finding their economies in trouble as in Southeast Asia or even worse, unable to make the transition to a market-driven economy. A. Micro B. Basic C. Macro D. Complex
answer
C. Macro
question
China's government policies regarding investment in the telecommunications industry fall into the _____ political risk category. A. Macro B. Micro C. Integrative D. Relative
answer
B. Micro
question
The economies of China, Russia, India and Vietnam present _____ political risk for MNCs. A. Macro B. Micro C. Proactive D. Relative
answer
A. Macro
question
_____ risk issues often take forms such as industry regulation, taxes on specific types of business activity and various restrictive local laws. A. Macro B. Standard C. Direct D. Micro
answer
D. Micro
question
According to the 2009 Transparency International Corruption Perceptions Index, which of the following is the least corrupt nation? A. India B. United States C. Spain D. New Zealand
answer
D. New Zealand
question
According to the 2009 Transparency International Corruption Perceptions Index, which of the following is the most corrupt nation? A. El Salvador B. Columbia C. Lebanon D. Somalia
answer
D. Somalia
question
The following are internal factors which MNCs may use to evaluate political risk except: A. Power struggles among elites B. Ethnic confrontations C. Regional struggles D. Regional instabilities
answer
D. Regional instabilities
question
The following is not an external factor used by MNCs for evaluating political risks: A. Alliances with major and regional powers B. Anti-establishment movements C. Internal groupings D. Sources of key raw materials
answer
B. Anti-establishment movements
question
Laws that require that nations hold a majority interest in the operation are known as: A. Commercial laws B. Appropriation laws C. Indigenization laws D. Expropriation laws
answer
C. Indigenization laws
question
The seizure of businesses by a host country with little, if any, compensation to the owners is referred to as: A. Nationalization B. Expropriation C. Dispossession D. Removal
answer
B. Expropriation
question
Expropriation is more likely to occur in: A. Non-Western governments that are poor, relatively unstable and suspicious of foreign multinationals B. Western governments that are rich, relatively stable and are experienced in dealing with foreign multinationals C. Non-Western governments that are neither rich nor poor, relatively stable and are unsure about the presence of foreign multinationals D. Western governments that are moderately wealthy, relatively stable and are new at dealing with foreign multinationals
answer
A. Non-Western governments that are poor, relatively unstable and suspicious of foreign multinationals
question
According to the text, the following are all forms of terrorism except: A. Classic terrorism B. Amateur terrorism C. Religious motivated terrorism D. Political terrorism
answer
D. Political terrorism
question
When terrorism entails a specific, well-defined objective pursued by well-trained, professional, underground members, it is called A. traditional terrorism B. amateur terrorism C. religiously motivated terrorism D. classic terrorism
answer
D. classic terrorism
question
Political risks can be broken down into three basic categories. These are: A. Transfer risks, ownership risks and labor risks B. Ownership risks, operational risks and economic risks C. Operational risks, bureaucratic risks and transfer risks D. Transfer risks, operational risks and ownership-control risks
answer
D. Transfer risks, operational risks and ownership-
question
_____ risks stem from government policies that limit the transfer of capital, payments, production, people and technology in or out of a country. A. Operational B. Bureaucratic C. Transfer D. Expropriation
answer
C. Transfer
question
Tariffs on exports and imports, restrictions on exports, dividend remittance and capital repatriation are examples of: A. Transfer risks B. Expropriation risks C. Operational risks D. Exchange risks
answer
A. Transfer risks
question
_____ risks result from government policies and procedures that directly constrain the management and performance of local operations. A. Transfer B. Operational C. Ownership-control D. Exchange
answer
B. Operational
question
Price controls, financing restrictions, export commitments, taxes and local-sourcing requirements are examples of: A. Ownership-control risks B. Operational risks C. Transfer risks D. Functional risks
answer
B. Operational risks
question
_____ risks are brought about by government policies or actions that inhibit ownership or control of local operations. A. Transfer B. Functional C. Operational D. Ownership-control
answer
D. Ownership-control
question
Foreign ownership limitations, pressure for local participation, confiscation, expropriation and abrogation of property rights are examples of: A. Transfer risks B. Functional risks C. Ownership-control risks D. Tactical risks
answer
C. Ownership-control risks
question
In a _____ investment, the goods or services produced are not similar to those produced at home. A. Horizontal B. Vertical C. Network D. Conglomerate
answer
D. Conglomerate
question
_____ investments include the production of raw materials or intermediate goods that are to be processed into final products. A. Vertical B. Matrix C. Conglomerate D. Horizontal
answer
A. Vertical
question
_____ investments run the risk of being taken over by the host-country government because they are export-oriented and governments like a business that helps it to generate foreign capital. A. Conglomerate B. Vertical C. Horizontal D. Lateral
answer
B. Vertical
question
_____ investments involve the production of goods or services that are the same as those produced at home. A. Conglomerate B. Lateral C. Horizontal D. Vertical
answer
C. Horizontal
question
_____ investments typically are made with an eye toward satisfying the host country's market demands. As a result, they are not very likely to be takeover targets. A. Vertical B. Horizontal C. Conglomerate D. Hierarchical
answer
B. Horizontal
question
The special nature of foreign direct investment is not related to: A. Sector B. Technology C. Ownership D. Operations
answer
D. Operations
question
Some multinational corporations attempt to manage political risk through simultaneously analyzing a range of variables to derive an overall rating of the degree of political risk in a given jurisdiction. This is referred to as a: A. Quantification process B. Quantification circle C. Quantity risk analysis D. Quantity management
answer
A. Quantification process
question
MNCs attempt to manage political risk through a quantification process, to derive an overall rating of the degree of political risk in a given jurisdiction. The factors that are quantified reflect all of the following except: A. Political and economic environment B. Domestic economic conditions C. Social conditions D. External economic conditions
answer
C. Social conditions
question
Which of the following criteria involves maximum political risk? A. International financial standing B. Economic growth during previous 5 years C. Restrictions imposed on imports D. Effectiveness of public administration
answer
D. Effectiveness of public administration
question
The following are listed as techniques for responding to political risks except: A. Relative bargaining power analysis B. Realistic bargaining power analysis C. Integrative techniques D. Proactive political strategies
answer
B. Realistic bargaining power analysis
question
The theory behind _____ is quite simple. The MNC works to maintain a stronger bargaining power position than that of the host country. A. Analogous negotiating power B. Pertinent bargaining power C. Proportionate negotiating power D. Relative bargaining power
answer
D. Relative bargaining power
question
_____ techniques are designed to help the overseas operation become part of the host country's infrastructure. A. Protective B. Defensive C. Integrative D. Statutory
answer
C. Integrative
question
All of the following are examples of integrative techniques except: A. Developing good relations with the host government and other local political parties B. Doing as little local manufacturing as possible and conducting all research and development outside the country C. Producing as much of the product locally as possible with the use of in-country suppliers and subcontractors, thus making it a "domestic" product D. Developing effective labor-management relations
answer
B. Doing as little local manufacturing as possible and conducting all research and development outside the country
question
_____ techniques are designed to discourage the host government from interfering in operations. A. Integrative and unifying B. Consolidating and defensive C. Protective and unifying D. Protective and defensive
answer
D. Protective and defensive
question
Examples of protective and defensive techniques include all of the following except: A. Limiting the responsibility of local personnel and hiring only those who are vital to the operations B. Raising capital from local banks and the host government as well as outside forces C. Diversifying production of the product among a number of countries D. Producing as much of the product locally as possible with the use of in-country suppliers and subcontractors, thus making it a "domestic" product
answer
D. Producing as much of the product locally as possible with the use of in-country suppliers and subcontractors, thus making it a "domestic"
question
Benefits of proactive political strategies include all of the following except: A. Enhancing government relations in unstable and transitional policy environments B. Mitigating risk before it becomes unmanageable C. Providing support for national and sub-central governments in transitional economies D. Counteracting competitors' efforts to influence government policy
answer
C. Providing support for national and sub-central governments in transitional economies
question
Examples of proactive political strategies include all of the following except: A. Formal lobbying B. Campaign financing C. Seeking advocacy through embassies and consulates of the home country D. Downsizing and transferring business elsewhere
answer
D. Downsizing and transferring business elsewhere
question
All the following are motivations for firms to enter into international strategic alliances except: A. Faster entry and payback B. Economies of scale C. Co-opting or blocking competition D. Stronger control over technologies and patents
answer
D. Stronger control over technologies and patents
question
Which of the following cultural differences tend to more disruptive for international joint ventures than the others? A. Power distance B. Uncertainty avoidance C. Individualism D. Masculinity
answer
B. Uncertainty avoidance
question
Which of the following is not a critical legal issue for successful termination of international alliances? A. Conditions of termination B. Disposition of assets and liabilities C. Distributorship arrangements D. People-related issues
answer
D. People-related issues
question
Which of the following is not a critical business issue for successful termination of international alliances? A. The basic decision to exit B. People-related issues C. Rights over sales territories and obligations to customers D. Relations with the host government
answer
C. Rights over sales territories and obligations to customers
question
When host governments do not require alliances as a condition for entry many MNCs: A. Are advised not to voluntarily pursue alliances as they tend to be problematic B. Are usually indifferent about establishing alliances C. Find that having an alliance is advantageous to their entry and expansion D. Are likely to consider alliances, except in emerging markets and highly regulated industries
answer
C. Find that having an alliance is advantageous to their entry and expansion
question
T/F: Home-country nationals are managers who are citizens of the country where the MNC is headquartered.
answer
TRUE
question
T/F: Historically, MNCs have staffed key positions in their foreign affiliates with host-country nationals.
answer
FALSE
question
T/F: Home-country nationals are local managers who are hired by the MNC.
answer
FALSE
question
T/F: Managers who live and work outside their home country are called expatriates.
answer
TRUE
question
T/F: An individual from a host-country who is assigned to work in the host-country is referred to as a multipatriate.
answer
FALSE
question
T/F: Factors used to choose personnel for international assignments are referred to as international selection criteria.
answer
TRUE
question
T/F: Most MNCs strive for a balance between age and experience in their expatriate employees.
answer
TRUE
question
T/F: The most common recruiting and selection procedures for international assignments would be background and reference checks.
answer
FALSE
question
T/F: Anticipatory and in-country factors will influence the expatriate's mode and degree of adjustment to an overseas assignment.
answer
TRUE
question
T/F: One of the reasons why there has been a decline in the number of expats in recent years is that MNCs have found that the expense can be prohibitive.
answer
TRUE
question
T/F: Base salary is the amount of money that an expatriate normally receives in the home country plus a cost-of-living adjustment.
answer
FALSE
question
T/F: Allowances are an expensive feature of expatriate compensation packages
answer
TRUE
question
T/F: An approach to developing an expatriate compensation package that is based on ensuring the expat is "made whole" and does not lose money by taking the assignment is referred to as the balance-sheet approach.
answer
TRUE
question
T/F: An approach to developing an expatriate compensation package that involves giving the expat a predetermined amount of money and letting the individual make his/her own decisions regarding how to spend it is referred to as localization.
answer
FALSE
question
T/F: For most overseas managers, repatriation occurs within five years of the time they leave.
answer
TRUE
question
T/F: Repatriation agreements typically promise an expatriate a specific position and salary when he/she returns to the home office.
answer
FALSE
question
T/F: The hardest training, in terms of preparation time is to place a cultural integrator in each foreign operation.
answer
FALSE
question
T/F: An ethnocentric MNC puts host-office people in charge of key international management positions.
answer
FALSE
question
T/F: Learning is the acquisition of skills, knowledge and abilities that results in a relatively permanent change in behavior.
answer
TRUE
question
T/F: The primary reason for training overseas managers is to improve their ability to interact effectively with local people in general and their personnel in particular.
answer
TRUE
question
There are four basic sources that MNCs can tap for positions. These are: A. Host-country nationals, third-country nationals, United Nations placements and IMF placements B. Home-country nationals, IMF placements, inpatriates and multipatriates C. Home-country nationals, host-country nationals, IMF placements and multipatriates D. Home-country nationals, host-country nationals, third-country nationals and inpatriates
answer
D. Home-country nationals, host-country nationals, third-country nationals and inpatriates
question
Expatriate managers who are citizens of the country where the multinational corporate is headquartered are referred to as: A. Host-country nationals B. Home-country nationals C. Inpatriates D. Third-country nationals
answer
B. Home-country nationals
question
Headquarters nationals is another term used for: A. Third-country nationals B. Home-country nationals C. Inpatriates D. Host-country nationals
answer
B. Home-country nationals
question
Home-country nationals are frequently called _____, which refers to those who live and work away from their home country. A. Inpatriates B. Third-country nationals C. Expatriates D. Multipatriates
answer
C. Expatriates
question
Historically, MNCs have staffed key positions in their foreign affiliates with: A. Home-country nationals B. Host-country nationals C. Inpatriates D. Third-country nationals
answer
A. Home-country nationals
question
_____ are local managers who are hired by the MNC. A. Inpatriates B. Indigenous-nationals C. Host-country nationals D. Home-country nationals
answer
C. Host-country nationals
question
Which of the following statements about third-country nationals is false? A. TCN managers can often achieve corporate objectives more effectively than do expatriates B. During periods of rapid expansion, TCNs can substitute for expatriates in well-established operations C. During rapid expansion, TCNs can offer different perspectives that can expand on the narrowly focused viewpoints of local nationals D. In joint ventures, TCNs can demonstrate a global image and bring unique cross-cultural skills to the relationship
answer
B. During periods of rapid expansion, TCNs can substitute for expatriates in well-established operations
question
These are managers who are citizens of countries other than the one in which the MNC is headquartered or the one in which they are assigned to work by the MNC. A. Multipatriates B. Home-country nationals C. Inpatriates D. Third-country nationals
answer
D. Third-country nationals
question
An individual from a host-country or a third-country national who is assigned to work in the home country is a(n): A. Expatriate B. Multipatriate C. Inpatriate D. Quasi-patriate
answer
C. Inpatriate
question
Factors used to choose personnel for international assignments are referred to as: A. Global placement criteria B. International selection criteria C. Global selection heuristics D. International recruitment and selection heuristics
answer
B. International selection criteria
question
All of the following are correct with regard to the impact of age, experience and education on expatriate managers except: A. There is universal agreement that degrees in marketing or engineering are the most desirable for expatriate managers B. Most MNCs strive for a balance between age and experience C. Many companies consider an academic degree, preferably a graduate degree, to be of critical importance to an international executive D. There is evidence that younger managers are more eager for international assignments than older managers
answer
A. There is universal agreement that degrees in marketing or engineering are the most desirable for expatriate managers
question
This is the primary language of international business and most expatriates from all countries can converse in it. A. French B. German C. Spanish D. English
answer
D. English
question
Borstorff and her associates examined the factors associated with employee willingness to work overseas and concluded that: A. Married couples with teenage children are probably the most willing to move B. Prior international experience appears associated with willingness to work as an expatriate C. Unmarried employees are least willing, compared to any other group, to accept expat assignments D. Careers and attitudes of spouses have an insignificant impact on employee willingness to move overseas
answer
B. Prior international experience appears associated with willingness to work as an expatriate
question
The process of evaluating how well a family is likely to stand up to the stress of overseas life is referred to as: A. Suitability assessment B. Selection fitness C. Adaptability screening D. Expatriate fitness
answer
C. Adaptability screening
question
The two most common selection procedures used by MNCs are: A. Assessment centers and tests B. References and interviews C. Application forms and assessment centers D. Tests and interviews
answer
D. Tests and interviews
question
In general, some evidence suggests that testing is: A. Extremely popular among MNCs B. Not extremely popular among MNCs C. Used more in the selection of overseas managers than domestic managers D. Used by a high percentage of MNCs in selecting expatriate managers
answer
B. Not extremely popular among MNCs
question
In recent years, international human resources management scholars have developed theoretical models that help to explain the factors involved in effectively adjusting to overseas assignments. These models are called: A. Adjustment models B. Adaptation theorems C. Alignment models D. Congruence theorems
answer
A. Adjustment models
question
There are two major types of adjustments that an expatriate must make when going on an overseas assignment. These are: A. Pre-deployment adjustment and post-deployment adjustment B. Direct adjustment and indirect adjustment C. Anticipatory adjustment and in-country adjustment D. Iterative adjustment and continuous adjustment
answer
C. Anticipatory adjustment and in-country adjustment
question
The adjustment model of the selection procedure for international assignments would include: A. Training and previous experience B. Education and modification C. Work experience and exposure D. Abilities and behavior
answer
A. Training and previous experience
question
The organizational input into anticipatory adjustment is most directly related and concerned with the: A. Motivation process B. Selection process C. Compensation plan D. Quality of leadership
answer
B. Selection process
question
Traditionally, what was the only selection criterion MNCs relied on for overseas assignments? A. Training B. Education C. Previous experience D. Technical competence
answer
B. Education
question
The most common elements in the typical expatriate compensation package include: A. Base salary, benefits, allowances, incentives and taxes B. Base salary, bonuses, stock options and free housing C. Base salary, benefits, free housing and free education for the expatriate's children D. Base salary, benefits, free travel, free housing and taxes
answer
A. Base salary, benefits, allowances, incentives and taxes
question
Expatriate salaries typically are set according to the base pay of: A. An index of 13 firms maintained by the United Nations B. The home country C. The host-country D. A neutral third-country determined by the expatriate and his/her company
answer
B. The home country
question
These are an expensive feature of expatriate compensation packages. A. Base salaries B. Allowances C. Incentives D. Taxes
answer
B. Allowances
question
The benefits of a lump-sum incentive system would include all of the following except: A. One-time payment retaining its value as an incentive B. Cost containment of firm due to one-time payment C. Separate payment distinguishable from regular pay D. Employees being encouraged to be motivated by financial incentives
answer
D. Employees being encouraged to be motivated by financial incentives
question
An approach to developing an expatriate compensation package that is based on ensuring that the expat is "made whole" and does not lose money by taking the assignment is referred to as the: A. Balance-sheet approach B. Lump-sum method C. Localization approach D. Cafeteria approach
answer
A. Balance-sheet approach
question
An approach to developing an expatriate compensation package that involves paying the expat a salary comparable to that of local nationals is referred to as: A. The cafeteria approach B. The balance-sheet approach C. Localization D. The lump-sum method
answer
C. Localization
question
An approach to developing an expatriate compensation package that involves giving the expat a predetermined amount of money and letting the individual make his/her own decisions regarding how to spend it is referred to as the: A. Localization approach B. Cafeteria approach C. Lump-sum method D. Balance-sheet approach
answer
C. Lump-sum method
question
This approach to developing an expatriate compensation package entails giving the individual a series of options and letting the person decide how to spend the available funds. A. Lump-sum method B. Cafeteria approach C. Localization approach D. Balance-sheet approach
answer
B. Cafeteria approach
question
Which of the following approaches is used to develop an expatriate compensation package that involves setting a compensation system for all expats who are assigned to a particular region and paying everyone in accord with that system? A. Regional system B. Balance-sheet approach C. Cafeteria approach D. Lump-sum method
answer
A. Regional system
question
The return to one's home country from an overseas management assignment is referred to as: A. Repatriation B. Reintroduction C. Recruiting D. Reentry
answer
A. Repatriation
question
Strategies used to help smooth the adjustment from an overseas to a stateside assignment are: A. Readjustment strategies B. Transition strategies C. Changeover strategies D. Progression strategies
answer
B. Transition strategies
question
An agreement whereby the firm tells the individual how long she/he will be posted overseas and promises to give the individual, on return, a job that is mutually acceptable is a: A. Strategic plan B. Human resource plan C. Labor-contract agreement D. Repatriation agreement
answer
D. Repatriation agreement
question
This is the process of altering employee behavior and attitudes in a way that increases the probability of goal attainment. A. Organizing B. Planning C. Training D. Controlling
answer
C. Training
question
An individual who is responsible for ensuring that a firm's business systems are in accord with those of the local culture is a(n): A. Cultural integrator B. Global facilitator C. International transition specialist D. Global socialization specialist
answer
A. Cultural integrator
question
The four basic philosophical positions that multinationals can assume and influence a company's training program are: A. Polycentric, geocentric, multicentric and ultracentric B. Ethnocentric, globalcentric, regiocentric and unicentric C. Multicentric, globalcentric, geocentric and unicentric D. Ethnocentric, polycentric, regiocentric and geocentric
answer
D. Ethnocentric, polycentric, regiocentric and geocentric
question
A(n) _____ MNC puts home-office people in charge of key international management positions. A. Ethnocentric B. Polycentric C. Regiocentric D. Geocentric
answer
A. Ethnocentric
question
Which of the following MNCs places local nationals in key positions and allows these managers to appoint and develop their own people? A. Geocentric B. Polycentric C. Regiocentric D. Ethnocentric
answer
B. Polycentric
question
This type of MNC relies on local managers from a particular geographic region to handle operations in and around that area. A. Ethnocentric B. Geocentric C. Polycentric D. Regiocentric
answer
D. Regiocentric
question
This type of MNC seeks to integrate diverse regions of the world through a global approach to decision making. A. Polycentric B. Ethnocentric C. Geocentric D. Regiocentric
answer
C. Geocentric
question
These MNCs do all of their training at their headquarters. A. Geocentric B. Regiocentric C. Polycentric D. Ethnocentric
answer
D. Ethnocentric
question
This is the acquisition of skills, knowledge and abilities that results in a relatively permanent change in behavior. A. Learning B. Development C. Motivation D. Controlling
answer
A. Learning
question
"Learning organizations" continually focus on activities such as: A. Planning and development B. Organizing and controlling C. Training and development D. Planning and organizing
answer
C. Training and development
question
Training programs are useful in preparing people for overseas assignments for many reasons. These reasons can be put into two general categories which are: A. Organizational and personal B. Economic and philosophical C. Personal and impersonal D. Financial and psychological
answer
A. Organizational and personal
question
The belief that one's own way of doing things is superior to that of others is: A. Polycentrism B. Geocentrism C. Ethnocentrism D. Regiocentrism
answer
C. Ethnocentrism
question
This is common in many large MNCs where managers believe that the home office's approach to doing business can be exported intact to all other countries, because this approach is superior to anything at the local level. A. Regiocentrism B. Ethnocentrism C. Geocentrism D. Polycentrism
answer
B. Ethnocentrism
question
Research shows that small firms undertaking international business generally rely on: A. Standard training programs B. Strategic alliances C. Trade zones D. Uniform commercial codes
answer
A. Standard training programs
question
Which of the following training programs are created for the specific needs of the participants? A. Generic B. Standardized C. Tailor-made D. Universal
answer
C. Tailor-made
question
A(n) _____ is a programmed learning technique that is designed to expose members of one culture to some of the basic concepts, attitudes, role perceptions, customs and values of another. A. Cultural assimilator B. Ethnocentric regulator C. Educational regulator D. Developmental assimilator
answer
A. Cultural assimilator
question
Which of the following terms refer to the quality of being effective and producing the desired results? A. Capacity B. Validity C. Reliability D. Stability
answer
B. Validity
Get an explanation on any task
Get unstuck with the help of our AI assistant in seconds
New