International Business Strategy
Final Exam Questions
Course Introduction
International Business Strategy explores the frameworks, concepts, and tools essential for developing and implementing effective strategies in a global business environment. The course examines the challenges and opportunities companies face when expanding into international markets, including political, economic, legal, and cultural factors. Students will analyze case studies, assess competitive advantage, and learn how multinational organizations adapt their strategies to diverse regulatory contexts and market conditions. Emphasis is placed on strategic planning, market entry modes, global supply chains, and navigating cross-cultural management to achieve sustainable international growth.
Recommended Textbook
Strategic Management 2nd Edition by
Frank T. Rothaermel
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12 Chapters
1522 Verified Questions
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Page 2
Chapter 1: What Is Strategy
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Sample Questions
Q1) With regard to stakeholder impact analysis, in what way did Starbucks go beyond its legal responsibilities and fulfill its ethical responsibilities?
Answer: A firm's ethical responsibilities, sometimes, go beyond its legal responsibilities.They embody the full scope of expectations, norms, and values of its stakeholders.Managers are called upon to do what society deems just and fair.Starbucks, for example, developed an ethical sourcing policy to help source coffee of the highest quality, while adhering to fair trade and responsible growing practices.
Q2) Define strategic management.What prevented Apple from going bankrupt approximately 15 years before its sudden success in 2012?
Answer: Strategic management, the topic of this course, is the integrative management field that combines analysis, formulation, and implementation in the quest for competitive advantage.
As mentioned in Chapter Case 1, On August 20, 2012, Apple's stock market valuation reached $623 billion, making it the most valuable public company of all time.A mere 15 years earlier, Apple would likely have gone bankrupt if arch-rival Microsoft (who enjoyed the same position with a valuation of $615 billion in December 1999)had not invested $150 million in Apple.
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Page 3
Chapter 2: Strategic Leadership: Managing the Strategy Process
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Sample Questions
Q1) Discuss the situations in which top-down strategic planning might be the most effective approach.
Answer: In a slow-moving environment, top-down strategic planning might be the most effective approach.Besides the rate of change, a second dimension is firm size.Larger firms tend to use either a top-down strategic planning process or scenario planning.
Q2) A company uses the planned emergence approach in the development of its strategies.Which of the following is an implication of this?
A) The employees will be isolated from the process of setting the company's vision and mission.
B) The lower-level employees will be restricted to the tasks involved in strategic implementation.
C) The company's organizational structure and systems will be designed to support bottom-up strategic initiatives.
D) The top management will create a strategy that is based on hard data alone, rather than an inspiring vision.
Answer: C
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4
Chapter 3: External Analysis: Industry Structure,
Competitive Forces, and Strategic Groups
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Sample Questions
Q1) When fashion magazines face competition from fashion blogs on the web, which of the following forces in Michael Porter's five forces model primarily gets stronger?
A) The emergence of entry barriers
B) The bargaining power of suppliers
C) The availability of complements
D) The threat of substitutes
Answer: D
Q2) In which of the following situations is the power of suppliers high in an industry?
A) Suppliers offer products that are undifferentiated.
B) Suppliers can credibly threaten to backward integrate into the industry.
C) Suppliers depend heavily on the industry for their revenues.
D) Suppliers' industry is more concentrated than the industry it sells to.
Answer: D
Q3) What are the important dimensions along which strategic groups differ?
Answer: Strategic groups differ from one another along important dimensions such as expenditures on research and development, technology, product differentiation, product and service offerings, pricing, market segments, distribution channels, and customer service.
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Chapter 4: Internal Analysis: Resources, Capabilities, and Core Competencies
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Sample Questions
Q1) Provide examples of the primary activities in a firm's value chain.
Q2) The perfectly competitive industry structure differs from the resource-based model in its view that:
A) all firms have access to the same resources.
B) accessibility to bundles of resources differ across firms.
C) resources tend to be "sticky."
D) competencies differ across firms working in the same industry.
Q3) Differentiate resource stocks from resource flows.
Q4) In the context of the VRIO Framework, what does a valuable resource mean?
Q5) In a generic value chain, a firm's after-sales service will be referred to as its _____.
A) primary activity
B) support activity
C) static resource
D) resource flow
Q6) Elaborate on time compression diseconomies.
Q7) Elaborate on the dynamic capabilities perspective of competitive advantage.
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Q8) List two ways by which a firm's valuable and rare resources can be imitated.
Q9) How does a firm benefit when its resources are costly to imitate?
Q10) How do firms benefit from value chain analysis?
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Page 7
Chapter 5: Competitive Advantage, Firm Performance, and Business Models
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Sample Questions
Q1) _____ precisely indicates how much of a firm's sales is converted into profits.
A) Break-even price
B) Working capital turnover
C) Return on revenue
D) Inventory turnover
Q2) Blue Ego Inc.is a market leader in the cell phone industry.To gain competitive advantage, the company has a post on its official site requesting its suppliers and customers to contribute ideas about the kinds of features and technology they think should be included in the next smartphone.This has helped the company reduce the burden of innovation on its employees, effectively meet customers' needs, and also include the larger community in product development.This process best exemplifies: A) offshoring.
B) product diversification.
C) crowdsourcing.
D) horizontal integration.
Q3) What are the three financial ratios that constitute return on revenue?
Q4) What does the ratio Selling, general, & administrative (SG&A)/Revenue indicate?
Q5) How are the balanced scorecard and triple-bottom-line approaches different from the traditional approaches to measure competitive advantage?
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Chapter 6: Business Strategy: Differentiation, Cost
Leadership, and Blue Oceans
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Sample Questions
Q1) Discuss the pricing options available to a firm pursuing a cost-leadership strategy.
Q2) A firm experiences _____ when there are increases in cost per unit as output increases.
A) diseconomies of scale
B) economies of scope
C) time compression diseconomies
D) economies of flow
Q3) Why is keeping its costs the lowest in the industry not the only focus of a firm pursuing cost-leadership strategy?
Q4) What are the two different generic business strategies available to firms?
Q5) In a focused cost-leadership strategy, a firm:
A) caters to the segment of the market that is least cost-sensitive.
B) provides high-priced products for many different segments of the mass market.
C) delivers low-cost products and services to a specific, narrow part of the market.
D) focuses on reducing the economic value created to drive down costs.
Q6) What is an integration strategy?
Q7) How does operating at the minimum efficient scale benefit a firm?
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Q8) When a firm pursues differentiation strategy, what does it focus on?
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Chapter 7: Business Strategy: Innovation, Entrepreneurship, and Platforms
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Sample Questions
Q1) Discuss the drawbacks of the industry life cycle.
Q2) Which of the following statements accurately brings out the difference between closed innovation and open innovation?
A) Firms following the open innovation model are much more likely to be prone to the not-invented-here syndrome than firms pursuing a closed innovation model.
B) While open innovation focuses on building an effective business model to commercialize R&D, closed innovation focuses on being first to market.
C) Firms following the open innovation model are more protective about their intellectual property than firms pursuing a closed innovation model.
D) While open innovation means introducing new technologies to new markets, closed innovation refers to introducing new technologies to existing markets.
Q3) Explain some of the features of the introduction stage of the industry life cycle.
Q4) Explain the reasons for increasingly rapid technological diffusion and adoption.
Q5) What happens during the shakeout stage of the industry life cycle?
Q6) Who are technology enthusiasts?
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Page 10
Chapter 8: Corporate Strategy: Vertical Integration and Diversification
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Sample Questions
Q1) What are the three types of specialized assets?
Q2) _____ is best described as moving one or more internal value chain activities outside the firm's boundaries to other firms in the industry value chain.
A) Strategic outsourcing
B) Reverse engineering
C) Forward integration
D) Horizontal integration
Q3) Managers in a firm hired to improve the firm's profitability and ultimately the shareholders' value will add to the overall costs if they pursue their own self interests.What does this best illustrate?
A) Diseconomies of scale
B) Principal-agent problem
C) Experience-curve effects
D) Information asymmetries
Q4) Discuss the benefits and drawbacks of short-term contracting as an alternative to buying in markets.
Q5) Discuss any two types of strategic alliances.
Q6) What conditions must be met for diversification to enhance firm performance?
Q7) What must executives decide when formulating a corporate strategy?
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Chapter 9: Corporate Strategy: Strategic Alliances, Mergers and Acquisitions
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Sample Questions
Q1) How does Kraft Foods benefit from its hostile takeover of Cadbury PLC in 2010?
A) Its main strategic focus is now on the domestic market.
B) It opens a market for it that is growing slowly but has high profit margins.
C) It has access to convenience stores and a new distribution channel.
D) It automatically gains monopoly in the chocolate-manufacturing industry.
Q2) What are the necessary conditions for selecting a partner for successful alliance formation?
Q3) How does horizontal integration decrease competitive intensity within an industry?
Q4) PureSource Pharma Inc.recently acquired BioChem Pharmaceuticals Inc.It now sells its own products along with the products originally sold by BioChem Pharmaceuticals.As a result, PureSource Pharma's sales force will also be marketing the acquired company's products.How will this horizontal integration most likely affect PureSource Pharma?
A) PureSource Pharma will lower its costs through economies of scale.
B) PureSource Pharma will diminish its economic value creation.
C) PureSource Pharma will increase its cost of distribution.
D) PureSource Pharma will reduce the size of its sales force.
Q5) Describe alliance management in the pharmaceutical company Eli Lilly.
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Q6) What does the relational view of competitive advantage propose?
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Chapter 10: Global Strategy: Competing Around the World
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Sample Questions
Q1) McDonald's uses mutton instead of beef in India and offers teriyaki burgers in Japan.Which of the following strategies is the fast food chain pursuing?
A) Multidomestic strategy
B) Focused differentiation strategy
C) Global-standardization strategy
D) International strategy
Q2) Evara Cosmetics Inc.is a company that operates in 20 countries around the globe.The company clearly understands that the skin and hair type of customers varies from one country to another.Consequently, its products are customized to suit local needs and preferences of customers, even though the costs incurred while producing these products are exceptionally high.This strategy helps the company behave as a local firm in a foreign market.In this scenario, which of the following strategies does Evara Cosmetics Inc.most likely implement?
A) A multidomestic strategy
B) An international strategy
C) A global-standardization strategy
D) A one-product strategy
Q3) China is infamous for its rampant business in illegal materials.Explain.
Q4) What is the engine behind globalization? Provide a real-world example.
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Chapter 11: Organizational Design: Structure, Culture, and Control
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Sample Questions
Q1) An organization is characterized as having a flexible division of labor, distributed decision-making, and generalized knowledge of how to accomplish strategic goals valued.This organization is most likely _____ in nature.
A) specialized
B) organic
C) mechanistic
D) formalized
Q2) Why does strategy implementation often require changes within an organization?
A) Strategy implementation is less important than strategy formulation.
B) Strategy implementation transforms strategy into actions and business models.
C) Strategy always follows structure.
D) Strategy implementation does not affect resource allocation and power distribution within an organization.
Q3) Describe a global matrix structure.Why do firms use it?
Q4) What are the requirements for an integration strategy to be successful?
Q5) Is centralization more effective than decentralization? Illustrate with examples.
Q6) Discuss how a cost-leadership strategy is used with a functional structure.
Q7) What is organizational inertia?
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Chapter 12: Corporate Governance and Business Ethics
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Sample Questions
Q1) Describe moral hazard with an example.
Q2) What is corporate governance?
Q3) Neville and Andre are customer care employees at JPN Care.In between calls, Neville and Andre spend time on Facebook and YouTube.The relaxed guidelines at JPN allow them to do that.However, sometimes, they knowingly avoid answering calls or keep customers on hold, while they check their social networking accounts.Such behavior:
A) is neither unlawful nor unethical; hence, Neville and Andre cannot be reprimanded.
B) typically exemplifies the agency problem of adverse selection.
C) goes against the principles of shareholder capitalism.
D) can be stopped by implementing performance incentives and strict control mechanisms.
Q4) The root cause of the principal-agent problem between senior executives and lower-level employees can be explained by the:
A) informational advantage of the lower-level employees.
B) higher number of lower-level employees than senior executives.
C) knowledge of employees regarding day-to-day tasks.
D) operational expertise of lower-level employees in concentrated areas of a particular field.
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