Global Business Environment
Practice Questions
Course Introduction
Global Business Environment examines the dynamic and complex factors influencing international business operations in today's interconnected world. This course explores how economic, political, legal, technological, and cultural environments impact global markets and affect decision-making for multinational organizations. Topics include international trade theories, global economic institutions, cross-cultural management, and the strategies firms use to compete and collaborate across borders. Through case studies and real-world examples, students gain a comprehensive understanding of global business challenges, risks, and opportunities, equipping them with tools to analyze and respond effectively to shifts in the global economy.
Recommended Textbook
Global Marketing 9th Edition by Warren J. Keegan
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Page 2
Chapter 1: Introduction to Global Marketing
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Sample Questions
Q1) If Nestlé decides not to market biscuits (cookies)in the United States due to competitive reasons, it is considered to be having a lack of strategic focus and missed opportunity.
A)True
B)False
Answer: False
Q2) Four decades ago, the phrase global marketing did not exist.
A)True
B)False
Answer: True
Q3) Why is it important for a firm to have global marketing strategy?
Answer: A firm's global marketing strategy (GMS)can enhance its worldwide performance. The GMS addresses several issues. First is the nature of the marketing program in terms of the balance between a standardized (extension)approach to the marketing mix elements and a localized (adaptation)approach that is responsive to country or regional differences. Second is the concentration of marketing activities in a few countries or the dispersal of such activities across many countries. Companies that engage in global marketing can also engage in coordination of marketing activities. Finally, a firm's GMS addresses the issue of global market participation.
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Page 3
Chapter 2: The Global Economic Environment
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Sample Questions
Q1) Upper-middle-income countries are also known as:
A)Industrializing countries.
B)BRIC countries.
C)Stabilized countries.
D)Manufacturing countries.
E)Agricultural countries.
Answer: A
Q2) Some people believe that marketing is relevant only in affluent, industrialized countries, whereas others believe that the role of marketing is to identify people's needs and wants worldwide, irrespective of the economy. Giving examples of companies involved in energy conservation and technology, support the latter argument.
Answer: People everywhere need affordable and safe drinking water. Recognizing this fact, Nestlé launched Pure Life bottled water in Pakistan. The Coca-Cola Company recently began to address dietary and health needs of low-income countries by developing a beverage, Vitango, which has several nutritional and health benefits. Technology is another area which can benefit countries all over the world. Intel's World Ahead is developing a $550 computer that is powered by a car battery. Hewlett-Packard engineers are working to develop solar-powered communication devices that can link remote areas to the Internet.
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Page 4
Chapter 3: The Global Trade Environment
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Sample Questions
Q1) Management strategic options pertaining to products that are facilitated by a single European market include:
A)standardized packaging and labeling.
B)consolidated production.
C)shift from brand to benefit segmentation.
D)seeking marketing economies.
E)all of the above
Answer: E
Q2) The six countries in the Gulf Cooperation Council (GCC)hold about 45% of the world's known oil reserves, but production is only about 18% of world oil output.
A)True
B)False
Answer: True
Q3) CARICOM's main objective has been to achieve a deepening of economic integration by means of a Caribbean common market.
A)True
B)False
Answer: True
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Chapter 4: Social and Cultural Environments
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Sample Questions
Q1) In Indonesia, home of the world's largest Muslim population, KFC uses Ramadan-themed outdoor advertising to encourage Indonesians to come to the restaurants at buka puasa, the end of each day's fast.
A)True
B)False
Q2) Colgate discovered that in Spanish colgate is a verb form that means "go hang yourself." Whirlpool found that consumers in Italy, France, and Germany had trouble pronouncing the name. These are examples which show the importance of ________ in global marketing.
A)syntax and morphology
B)phonology and morphology
C)syntax and semantics
D)semantics and phonology
E)semantics and morphology
Q3) Reference to one's own cultural values or self-reference criterion (SRC)can create a cultural myopia. It can consciously or unconsciously create considerable problems for marketing professionals. Using Walt Disney's decision to build a theme park in France, address the problem, following a systematic framework.
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Chapter 5: The Political, Legal, and Regulatory Environments
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Sample Questions
Q1) The company receiving the most U.S. patents in 2013 was:
A)Samsung Electronics.
B)IBM.
C)Microsoft.
D)Canon.
E)Panasonic.
Q2) After Fidel Castro took power in Cuba in 1959, his government seized control of American property without paying compensation. Coca-Cola, DuPont, Texaco, and dozens of other American companies have filed claims against Cuba seeking financial settlements. Which of the following terms most specifically describes the action Castro took against these companies?
A)nationalization
B)confiscation
C)expropriation
D)internationalization
E)deportation
Q3) In France, laws forbid the use of foreign words such as le weekend or le marketing in official documents.
A)True
B)False
Page 7
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Chapter 6: Global Information Systems and Market Research
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Sample Questions
Q1) Retailers are increasingly using a technique known as efficient consumer response (ECR)in an effort to work more closely with vendors on stock replenishment.
A)True
B)False
Q2) CRM tools does not help companies in determining:
A)warranty of products sold to consumers.
B)amount paid by consumers in different countries.
C)which customers are very demanding.
D)the use of credit cards for payment.
E)the use of laptop computers by customers.
Q3) When a trained person is recording the items selected in a grocery cart or basket, the research method is known as:
A)observation.
B)survey research.
C)focus study.
D)secondary data collection.
E)personal interviews.
Q4) What is meant by Comparative Analysis and Market Estimation by Analogy? How can these be helpful in marketing research?
Page 8
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Chapter 7: Segmentation, Targeting, and Positioning
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Sample Questions
Q1) When making a decision about market entry timing, a company's management team should understand that the first-mover always becomes the market leader.
A)True
B)False
Q2) Which of the following is generally true about the marketing of high-touch products such as fine china and crystal?
A)It relies equally on specialized information and image.
B)It relies less on image and more on specialized information.
C)It relies less on specialized information and more on image.
D)Neither image nor specialized information is relevant to the marketing of high-touch products.
E)It relies partially on specialized information and partially on image.
Q3) What are the major differences between global, foreign, and local consumer culture positioning? Why are these differences significant? Give examples of how companies are trying to lure customers using these positioning strategies.
Q4) What is psychographic segmentation, and how do marketers use it in targeting different world markets?
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9
Chapter 8: Importing, Exporting, and Sourcing
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Q1) For every one yen increase relative to the American dollar, Canon's operating income declines by 6 billion yen.
A)True
B)False
Q2) Governmental actions at times are designed to discourage imports and block market access. Why do governments want to curtail imports? Explain some of the barriers that are placed to discourage imports.
Q3) The furniture industry has become one of the fastest-growing sectors of China's economy. Furniture imports are flooding into the United States from China. This can be attributed to:
A)the quality of furniture is better than that made in Europe.
B)American tastes in décor have changed.
C)China's low labor rates translate into reasonable prices for consumers.
D)China can survive tough competition.
E)replacement parts are readily available from China.
Q4) In an effort to facilitate Z).exports, countries are designating certain areas as "free trade zones" (FTZ)or "special economic zones" (SE
A)True
B)False
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Chapter 9: Global Market Entry Strategies: Licensing, Investment, and Strategic Alliances
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Q1) Franchising is a variation of licensing strategy in which there is a contract between the parent company franchiser and a franchisee that allows the franchisee to operate a business developed by the franchiser in return for all rights for operations.
A)True
B)False
Q2) Franchising in a global market is actually a market-entry strategy that is typically executed with less localization than is licensing.
A)True
B)False
Q3) Which of the following does not fit into the sequence of experiences Anheuser-Busch had in Japan?
A)Anheuser-Busch first entered Japan by means of a licensing agreement with Suntory, the smallest brewery in Japan.
B)Anheuser-Busch created a joint venture with Kirin Brewery, the market leader.
C)Anheuser-Busch dissolved the joint venture with Kirin Brewery.
D)Anheuser-Busch entered into a joint venture with Kirin Brewery.
E)Anheuser-Busch reverted to a licensing agreement with Kirin Brewery.
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Page 11
Chapter 10: Brand and Product Decisions in Global Marketing
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Sample Questions
Q1) Why are packaging aesthetics an important consideration in global product marketing?
Q2) Microsoft's Windows 7 operating system was launched in 2009 with the user-centric global advertising campaign keyed to the theme "I'm a PC, and Windows 7 was my idea." This is an example of the dual-extension strategy.
A)True
B)False
Q3) Many American car buyers perceive Korean cars as:
A)durable.
B)cheap.
C)reliable.
D)of high quality.
E)good investment.
Q4) Laws and regulations in different countries frequently lead to obligatory design. Giving examples, show how this can have an impact in global marketing.
Q5) The "wave" that appears on red Coke cans and bottle labels is an example of a brand symbol.
A)True
B)False
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Chapter 11: Pricing Decisions
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Sample Questions
Q1) The skimming pricing strategy is appropriate in the mature phase of the product life cycle.
A)True
B)False
Q2) Germany's Bayer Group was fined millions of dollars to settle a lawsuit alleging it had conspired with Archer Daniels Midland and other global companies to set prices for an enzyme used in animal feeds. What was the issue in this lawsuit?
A)price skimming
B)market penetration
C)price bundling
D)price fixing
E)dumping
Q3) A strengthening of the home-country currency swings exchange rates in a favorable direction.
A)True
B)False
Q4) How does "Switch Trading" works in global marketing? What is the advantage of the "switching mechanism?" Comment on the logistics and fees involved in this type of arrangement.
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Chapter 12: Global Marketing Channels and Physical Distribution
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Q1) Japanese retailers traditionally offered few extra services to clientele; their stock was chosen not according to consumer demand but, rather, according to purchasing preferences of the stores.
A)True
B)False
Q2) "Organized retail" is a term used to describe:
A)modern chain stores.
B)grocery stores.
C)local retail chains.
D)supermarkets.
E)hypermarkets.
Q3) Legislatures in India are suspicious about Walmart's motives in going to India, since they fear the foreigners will raise prices after they have driven small operators out of business.
A)True
B)False
Q4) Trains are more reliable than trucks for transportation of goods.
A)True
B)False
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Q5) What are global retail categories? Describe these categories giving examples.
Chapter 13: Global Marketing Communications Decisions I:
Advertising and Public Relations
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Q1) India leads the world in terms of watching the most television; daily viewership is 5 hours, 39 minutes each day.
A)True
B)False
Q2) Companies use corporate advertising; image advertising, and advocacy advertising from time to time. How are these advertising methods? What are the circumstances under which they are used?
Q3) Western advertising agencies still find markets such as China and Japan to be very complex, as Asian agencies find it just as difficult to establish local agency presence in western markets.
A)True
B)False
Q4) A critical factor in India's media environment is the lack of penetration by cable television and the fact that only about 4 million Indians currently subscribe to an Internet service.
A)True B)False
Q5) What issues must be considered in selecting an advertising agency for global advertising?
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Chapter 14: Global Marketing Communications Decisions 2:
Sales Promotion, Personal Selling, and Special Forms of
Marketing Communication
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Q1) A company with a polycentric orientation is likely to employ host-country nationals in all but which of the following selling situations?
A)selling high-tech products in developed countries
B)selling high-tech products in less-developed countries
C)selling low-tech products in developed countries
D)selling low-tech products in less-developed countries
E)none of the above
Q2) A marketer of fine French cognac offers fancy cigar ashtrays as prizes to consumers who correctly solve a crossword puzzle. Which of the following most accurately describes this offer?
A)price promotion
B)non-price promotion
C)trade sales promotion
D)sweepstakes promotion
E)sampling
Q3) Cross coupons offer its users deal-of-the-day that are sponsored by local businesses.
A)True
B)False
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Chapter 15: Global Marketing and the Digital Revolution
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Q1) W3C is a foundation that helps develop standards that allow the full potential of the Web to be realized.
A)True
B)False
Q2) According to Christensen's five principles of disruptive innovations, the following statement is not true:
A)companies depend on customers and investors for resources.
B)small markets solve the growth needs of large companies.
C)markets that don't exist can't be analyzed.
D)an organization's capabilities define its disabilities.
E)technology supply may not equal market demand.
Q3) In South Korea, the Netherlands, Greenland, the UAE, Bahrain, and Qatar, more than 90 percent of the population is online.
A)True
B)False
Q4) Because the Internet is global, no single country controls it.
A)True
B)False
Q5) What is convergence? What kind of challenges does it present?
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Chapter 16: Strategic Elements of Competitive Advantag
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Q1) Chance events play a role in shaping the competitive environment. Chance events are occurrences which include all of the following except:
A)major technological breakthroughs.
B)wars and their aftermath.
C)oil crisis.
D)currency fluctuations.
E)annual business meeting.
Q2) In the shipbuilding industry, Polish and Chinese shipyards offer simple, standard vessel types at low prices that reflect low production costs. This represents generic strategy related to:
A)cost leadership.
B)differentiation.
C)cost focus.
D)focused differentiation.
E)cost differentiation.
Q3) In addition to the five forces model of industry competition, Michael Porter has developed a framework of so-called generic business strategies. Explain these generic strategies, describing their aims and application.
Q4) How do chance events play a role in shaping the competitive environment?
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Chapter 17: Leadership, Organization, and Corporate Social Responsibility
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Q1) One of the Corporate Social Responsibility (CSR)initiatives by IKEA's primary carpet supplier in India is to provide good working conditions for children working in the India's carpet industry.
A)True
B)False
Q2) The Subaru nameplate is synonymous with the company's Symmetrical All-Wheel Drive and Partial Zero Emissions Vehicle (PZEV)engineering.
A)True
B)False
Q3) According to Carly Fiorina, former CEO of Hewlett-Packard, leadership is about: A)hierarchy.
B)title.
C)status.
D)connecting.
E)bragging.
Q4) What are regional management centers? What are the advantages of having such centers in global businesses?
Q5) What are some examples of global marketing where corporations have undertaken Corporate Social Responsibility (CSR)?
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