Global Strategy Exam Materials
Course Introduction
Global Strategy examines how organizations develop and implement strategies to compete successfully in international markets. The course explores key concepts such as global competitive dynamics, entry modes, cross-border alliances, risk assessment, and adaptation versus standardization of products and services. Students will analyze how cultural, economic, political, and legal factors influence multinational operations and the formulation of global strategies. Through case studies and practical frameworks, the course equips learners with the tools necessary to assess global opportunities, build competitive advantages, and navigate the complexities of international business environments.
Recommended Textbook
International Business Competing in the Global Marketplace 12th Edition by Charles
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20 Chapters
2122 Verified Questions
2122 Flashcards
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Page 2
W. L. Hill
Chapter 1: Globalization
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105 Verified Questions
105 Flashcards
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Sample Questions
Q1) The Uruguay Round provided
A) reduced protection for patents, trademarks, and copyrights.
B) enhanced protection for patents, trademarks, and copyrights.
C) increased trade barriers.
D) reduced coverage of services and manufactured goods.
Answer: B
Q2) Evidence suggests that technological change has had a bigger impact than globalization on the declining share of national income enjoyed by unskilled labor.
A)True
B)False
Answer: True
Q3) The ________ is primarily responsible for policing the world trading system and making sure nation-states adhere to the rules laid down in trade treaties signed by member states.
A) International Development Association
B) World Bank
C) International Court of justice
D) World Trade Organization
Answer: D
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Page 3
Chapter 2: National Differences in Political, Economic, and Legal Systems
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107 Verified Questions
107 Flashcards
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Sample Questions
Q1) The central message of collectivism is that individual economic and political freedoms are the ground rules on which a society should be based.
A)True
B)False
Answer: False
Q2) Discuss the ways in which public action to violate property rights can occur.
Answer: Public action to violate property rights occurs when public officials, such as politicians and government bureaucrats, extort income, resources, or the property itself from property holders. This can be done through legal mechanisms such as levying excessive taxation, requiring expensive licenses or permits from property holders, taking assets into state ownership without compensating the owners, or redistributing assets without compensating the prior owners. It can also be done through illegal means, or corruption, by demanding bribes from businesses in return for the rights to operate in a country, industry, or location.
Q3) Product liability can be much lower if a product does not conform to required safety standards.
A)True
B)False
Answer: False
Page 4
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Chapter 3: National Differences in Economic Development
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103 Verified Questions
103 Flashcards
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Sample Questions
Q1) By identifying and investing early in a potential future economic star, international firms can ________ and gain experience in that country's business practices.
A) build brand loyalty
B) learn which government officials need to receive kickbacks
C) begin to stockpile that country's currency
D) build infrastructure
Answer: A
Q2) Google launched Google Plus to gain a foothold in the social media market. However, given that there are numerous social networking platforms and Facebook is already a leader in social media, Google Plus found it challenging to generate brand loyalty and establish itself in the market. This was because of
A) incumbent disadvantage.
B) disintermediation disadvantage.
C) late-mover disadvantage.
D) horizontal integration disadvantage.
Answer: C
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5
Chapter 4: Differences in Culture
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105 Verified Questions
105 Flashcards
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Sample Questions
Q1) People who share a common set of values and norms form a A) culture.
B) society.
C) country.
D) caste.
Q2) ________ is/are best defined as shared assumptions about how things ought to be.
A) Norms
B) Values
C) Society
D) Culture
Q3) Education plays an important role, from an international business perspective, as a determinant of national competitive advantage.
A)True
B)False
Q4) What is ethnocentrism?
A) a belief in the superiority of one's business or organization over another
B) a belief in the superiority of another group or culture over one's own group or culture
C) a belief in the superiority of one's own ethnic group or culture
D) a belief in the superiority of one's self over another person
Page 6
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Chapter 5: Ethics, Corporate Social Responsibility, and Sustainability
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108 Verified Questions
108 Flashcards
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Sample Questions
Q1) A firm's ________ include customers, suppliers, and lenders.
A) internal stakeholders
B) clients
C) external stakeholders
D) community
Q2) Which of the following refers to the values and norms that the employees of an organization share?
A) vision statement
B) cultural relativism
C) organization culture
D) power orientation
Q3) Ethical dilemmas exist because many real-world decisions involve
A) first-, second-, and third-order consequences that are hard to quantify.
B) people from different cultures.
C) employers and employees.
D) people from different multinational firms.
Q4) What is considered normal business practice in one country may be considered unethical in other countries.
A)True
B)False
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Chapter 6: International Trade Theory
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97 Verified Questions
97 Flashcards
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Sample Questions
Q1) Which of the following is one of the four attributes present in Porter's diamond?
A) economies of scale
B) factor endowments
C) structural innovation
D) procedural innovation
Q2) A key assumption in the Heckscher-Ohlin theory is that technologies are the same across countries.
A)True
B)False
Q3) Explain how the principle of diminishing returns weakens the Ricardian model.
Q4) Which of the following balance-of-payment accounts records onetime changes in the stock of assets?
A) capital account
B) current account
C) financial account
D) monetary account
Q5) What are the four attributes that are discussed in Porter's diamond?
Q6) Identify a major disadvantage of the product life-cycle theory.
Q7) Explain Smith's theory of absolute advantage.
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Chapter 7: Government Policy and International Trade
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110 Verified Questions
110 Flashcards
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Sample Questions
Q1) Import tariffs
A) reduce the price of foreign goods.
B) create efficient utilization of resources.
C) reduce the overall efficiency of the world economy.
D) are generally pro-consumer and anti-producer.
Q2) Explain the disadvantages of government protectionism as it relates to competitive advantage.
Q3) Which of the following is a consequence of subsidies?
A) Subsidies make domestic producers vulnerable to foreign competition.
B) Subsidies lead to lowered production.
C) Subsidies protect inefficient domestic producers.
D) Subsidies produce revenue for the government.
Q4) In the United States, the only firms allowed to import cheese are certain trading companies, each of which is allocated the right to import a maximum number of pounds of cheese each year. This is an example of
A) a subsidy.
B) an import quota.
C) a local content requirement.
D) an ad valorem tariff.
Q5) Explain the notion of predatory behavior with regard to dumping.
Page 9
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Chapter 8: Foreign Direct Investment
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108 Verified Questions
108 Flashcards
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Sample Questions
Q1) Mergers and acquisitions are quicker to execute than greenfield investments.
A)True
B)False
Q2) Which of the following is an example of a greenfield investment?
A) A Chinese sugar maker sets up a sugar crushing facility in Cuba.
B) A Serbian automobile company purchases a Croatian component manufacturer.
C) A Finnish mobile phone manufacturer expands its production facility in Finland.
D) An Indian oil exploration company acquires an oil refining company.
Q3) According to Knickerbocker's theory
A) when a firm has valuable know-how that cannot be adequately protected by a licensing contract, it engages in FDI.
B) when a firm's skills and know-how are not amenable to licensing, it usually prefers the FDI route.
C) by placing tariffs on imported goods, governments indirectly increase the cost of exporting relative to foreign direct investment and licensing.
D) when a firm that is part of an oligopolistic industry expands into a foreign market, other firms in the industry will be compelled to make similar investments.
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Chapter 9: Regional Economic Integration
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98 Verified Questions
98 Flashcards
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Sample Questions
Q1) ________ occurs when high-cost domestic producers are replaced by low-cost producers within the free trade area.
A) Trade deficit
B) Trade diversion
C) Trade creation
D) Trade distortion
Q2) Compare and contrast a free trade area and a common market. Provide examples.
Q3) The emerging role of the ________ in competition policy suggests the EU is increasingly willing and able to intervene and impose conditions on companies proposing mergers and acquisitions.
A) European Commission
B) Court of Justice
C) European Council
D) European Parliament
Q4) Explain the North American Free Trade Agreement and then debate its ratification.
Q5) The Treaty of Rome, signed in 1957, established the European Free Trade Association.
A)True
B)False
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Chapter 10: The Foreign Exchange Market
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105 Verified Questions
105 Flashcards
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Sample Questions
Q1) Discuss the failure of PPP theory to predict exchange rates accurately. What is the purchasing power parity puzzle?
Q2) What is the law of one price?
Q3) A currency is said to be freely convertible when
A) its exchange rate with respect to other currencies is decided by the central bank of the country.
B) residents alone are allowed to convert it into a foreign currency without any limitations.
C) neither residents nor nonresidents are allowed to convert it into a foreign currency.
D) both residents and nonresidents are allowed to purchase unlimited amounts of a foreign currency with it.
Q4) What are the main uses of foreign exchange markets for international business?
Q5) Discuss the two schools of thought on exchange rate forecasting.
Q6) A(n) ________ is one in which prices do not reflect all available information.
A) inefficient market
B) speculative market
C) efficient market
D) externally convertible market
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Chapter 11: The International Monetary System
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101 Verified Questions
101 Flashcards
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Sample Questions
Q1) Gold par value refers to the
A) ratio of the price of gold in a currency to the price of gold in U.S. dollars.
B) amount of a currency needed to purchase one ounce of gold.
C) ratio of price of gold in a currency to the price of gold in euros.
D) amount of gold required to equal the reference currency that a nation is using.
Q2) A country that introduces a currency board commits itself to converting its domestic currency on demand into another currency at a fixed exchange rate.
A)True
B)False
Q3) A country is said to be in balance-of-trade equilibrium when
A) the income its residents earn from exports is equal to the money its residents pay to other countries for imports.
B) it produces all the goods needed for domestic consumption.
C) the income its residents earn from imports is equal to the money its residents pay to other countries for exports.
D) it produces all the goods needed for exportation.
Q4) Present the common arguments that favor fixed exchange rates.
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Chapter 12: The Global Capital Market
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104 Verified Questions
104 Flashcards
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Sample Questions
Q1) The cost of recording, transmitting, and processing information has doubled with advancements in technology since 1964.
A)True
B)False
Q2) The cost of capital is the difference between cost of inputs and outputs.
A)True
B)False
Q3) What makes Eurobonds more attractive than most major domestic bonds?
A) presence of regulatory interference
B) strong disclosure requirements
C) favorable tax status
D) protection from exchange risks
Q4) If the international capital market continues to grow, financial intermediaries likely will provide less quality information about foreign investment opportunities.
A)True
B)False
Q5) Write a brief note on foreign exchange risks and the cost of capital.
Q6) Explain Eurobonds with an example.
Q7) What is a capital market? Define market makers.
Page 14
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Chapter 13: The Strategy of International Business
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102 Verified Questions
102 Flashcards
Source URL: https://quizplus.com/quiz/3559
Sample Questions
Q1) Which of the following is an example of a support activity in a firm's value chain?
A) research and development
B) customer service
C) human resources
D) marketing and sales
Q2) Enterprises that pursue an international strategy tend to decentralize control over marketing and product strategies.
A)True
B)False
Q3) Discuss how a firm's marketing strategies may have to address differences in distribution channels in other countries.
Q4) Which of the following is true of the international strategy?
A) Product development tends to be highly decentralized.
B) Manufacturing and marketing are typically located in the headquarters location.
C) Extensive production customization is common.
D) The strategy is not viable in the long term.
Q5) How can a firm increase its profitability?
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Page 15
Chapter 14: The Organization of International Business
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106 Verified Questions
106 Flashcards
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Sample Questions
Q1) Regardless of a firm's domestic structure, its international division tends to be
A) organized on economy.
B) decentralized.
C) organized on geography.
D) centralized.
Q2) Which control system is most widely used by small firms?
A) personal
B) output
C) bureaucratic
D) cultural
Q3) Which of the following is a potential drawback of the worldwide area structure?
A) This structure discourages division of the organization into autonomous entities.
B) This structure makes it difficult to decentralize decisions regarding operations authority.
C) This structure makes it difficult to realize location and experience curve economies.
D) This structure reduces local responsiveness.
Q4) What is a knowledge network? What is the advantage of such a system?
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16
Chapter 15: Entry Strategy and Strategic Alliances
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111 Verified Questions
111 Flashcards
Source URL: https://quizplus.com/quiz/3561
Sample Questions
Q1) Which of the following is true of licensing?
A) Licensing is used when a firm possesses some tangible property but does not want to pursue a potential application itself.
B) The firm does not have to bear the development costs and risks associated with opening a foreign market.
C) It is an attractive option when a firm is interested in pursuing a foreign market and is ready to commit substantial resources to a foreign market.
D) It is an attractive option for firms that have the capital to open overseas markets.
Q2) Consider why a firm should enter a market via a wholly owned subsidiary. What are the advantages and disadvantages of this type of strategy?
Q3) In ________, the contractor agrees to handle every detail of the project for a foreign client.
A) a joint venture
B) an exporting agreement
C) a turnkey project
D) a licensing agreement
Q4) Discuss the three primary characteristics of a good ally.
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Chapter 16: Exporting, Importing, and Countertrade
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106 Verified Questions
106 Flashcards
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Sample Questions
Q1) What is a disadvantage of countertrade?
A) Countertrade contracts may involve the exchange of unusable or poor-quality good.
B) Countertrade requires the firm to use an out-of-house trading company to which much of the profit will go.
C) Countertrade contracts often involve high-quality, expensive goods that the firm cannot move enough of to be profitable.
D) Countertrade requires employing lawyers who specialize in these unique types of contracts.
Q2) ________ is viewed as the most restrictive countertrade arrangement.
A) Barter
B) Offset
C) Buyback
D) Switch trading
Q3) Compare and contrast counterpurchase agreements and offset arrangements. Why might an exporter prefer an offset to a counterpurchase deal?
Q4) Time drafts cannot be sold to investors at a discount from face value.
A)True
B)False
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18
Chapter 17: Global Production and Supply Chain Management
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105 Flashcards
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Sample Questions
Q1) Just-in-time systems
A) leave a firm without a buffer stock of inventory.
B) ensure that product is always available.
C) help a firm respond quickly to increases in demand.
D) allow for stockpiling of key components of production.
Q2) Concentration of production is appropriate when
A) the product serves universal needs.
B) the product does not serve universal needs.
C) the product's value-to-weight ratio is low.
D) volatility in important exchange rates is expected.
Q3) Decentralization of production is appropriate when
A) the product's value-to-weight ratio is high.
B) location externalities are important.
C) the product serves universal needs.
D) volatility in important exchange rates is expected.
Q4) Identify an advantage of adopting a low minimum efficient scale.
A) It helps companies reduce the level of initial capital required for business.
B) It allows the firm to accommodate demands for local responsiveness.
C) It allows firms to discount political risks and other global capital risks.
D) A minimum efficient scale of a plant allows decentralization of production.
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Chapter 18: Global Marketing and R&D
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121 Verified Questions
121 Flashcards
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Sample Questions
Q1) The means a firm chooses for delivering the product to the consumer is its
A) communication strategy.
B) segmentation strategy.
C) product attributes.
D) distribution strategy.
Q2) If market segments transcend national borders
A) the company should develop unique products for each national market.
B) the company can view the global market as a single entity and pursue a global strategy.
C) a localization strategy would be appropriate.
D) consumers will have differing purchasing behavior in different nations.
Q3) The longer the distribution channel, the more intermediaries there are that must be persuaded to carry the product for it to reach the consumer.
A)True
B)False
Q4) In a concentrated retail system
A) there are many retailers who have a major share of the market.
B) there are many retailers, none of which has a major share of the market.
C) a few retailers supply a small segment of the market.
D) a few retailers supply most of the market.
Page 20
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Chapter 19: Global Human Resource Management
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111 Verified Questions
111 Flashcards
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Sample Questions
Q1) An ethnocentric approach to staffing is appropriate for firms that are pursuing
A) a localization strategy.
B) an international strategy.
C) a global standardization strategy.
D) a transnational strategy.
Q2) In a seminal study, R.L. Tung found that for Japanese multinationals, the biggest impediment to expatriate success was
A) the inability of the spouse to adjust.
B) inadequate compensation.
C) the manager's inability to cope with larger overseas responsibilities.
D) the lack of adequate technical training.
Q3) ________ makes it difficult to evaluate the performance of expatriate managers objectively.
A) Cultural relativism
B) Internal documentation
C) Unintentional bias
D) Others-orientation
Q4) Why should a firm pursue an ethnocentric approach to staffing? What are the disadvantages of this approach?
Q5) How can firms reduce the bias in performance appraisals of expatriate managers?
Page 21
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Chapter 20: Accounting and Finance in the International Business
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109 Verified Questions
109 Flashcards
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Sample Questions
Q1) A ________ specifies that parent companies are not taxed on foreign source income until they actually receive a dividend.
A) bilateral agreement
B) tax credit
C) deferral principle
D) tax treaty
Q2) Part of the tax credit benefit that a parent company receives can be lost if the subsidiary's
A) combined tax rate is higher than the parent's.
B) local government views royalties as an expense.
C) local tax rates on profits are extremely high.
D) managers are controlled directly by the parent.
Q3) The ________ has 16 members who are responsible for the formulation of new international financial reporting standards.
A) U.S. Securities and Exchange Commission
B) International Accounting Standards Board
C) Office of Economic Analysis
D) Financial Accounting Standards Board
Q4) Briefly differentiate accounting standards and auditing standards.
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