Deck 1: Globalizing Business

Question 1

The emerging markets of the world are placed at the top of the global economic pyramid.

Answer 1

False

Question 2

Globalization has driven up the salaries of low-level jobs.

Answer 2

False

Question 3

The global economic pyramid does not represent countries that have a per capita annual income of less than $2,000.

Answer 3

False

Question 4

The Group of 20 includes the European Union (EU)-a regional bloc.

Question 5

Gross domestic product (GDP)is the sum of value added by resident firms,households,and governments operating in an economy.

Question 6

Reverse innovations are innovations that are adopted first in the Triad-based multinationals and then diffused around the world.

Question 7

On the global economic pyramid,the Triad refers to developed economies consisting of North America,Western Europe,and Japan.

Question 8

The term "base of the pyramid" represents economies where individuals make less than $2,000 a year.

Question 9

Reverse innovation is an example of bottom up innovation.

Question 10

All the countries of the BRIC belong to the top tier of the global economic pyramid.

Question 11

The term "emerging markets" refers to all markets other than the developed markets.

Question 12

The second tier of the global economic pyramid is made up of countries with a per capita annual income of more than $20,000.

Question 13

A multinational enterprise is a firm that engages in foreign direct investment by directly managing value-added activities in other countries.

Question 14

Approximately 80 million people worldwide are employed by foreign-owned firms.

Question 15

An international premium is a significant pay raise awarded to expatriate employees working abroad.

Question 16

Majority of the global GDP is contributed by the emerging markets.

Question 17

Emerging markets contribute about 26% of global GDP without adjusting for purchasing power parity (PPP).

Question 18

More than half the GDP produced by emerging markets comes from outside the BRIC countries.

Question 19

Purchasing power parity (PPP)is a conversion that determines the equivalent amount of goods and services different currencies can purchase.

Question 20

Purchasing power parity (PPP)is calculated as the sum of value added by resident firms,households,and governments operating in an economy.

Question 21

According to the pendulum view of globalization,globalization is a relatively new phenomenon triggered by the information revolution of early 1990s.

Question 22

Semiglobalization is primarily caused by the practice of total isolation.

Question 23

The institution-based view places emphasis on the external factors that could affect a firm.

Question 24

Liability of foreignness is the inherent disadvantage experienced by foreign firms in host counties because of their non-native status.

Question 25

Standardization of markets would lead to a state of semiglobalization.

Question 26

Formal institutions include laws,regulations,and rules.

Question 27

Without adjusting for PPP,emerging economies contribute about 26% of the global GDP.Adjusting for PPP,they now contribute approximately 45% of the global GDP.The reason there is a huge difference between the two measures is because:

A) the cost of living in emerging economies tends to be lower than that in developed economies.
B) the purchasing power parity is much higher in emerging countries.
C) the population in emerging economies is much higher than that in developed economies.
D) the deficit spending in emerging economies is much larger than that in developed economies.

Question 28

A conversion that determines the equivalent amount of goods and services that different currencies can buy is known as _____.

A) purchasing power parity
B) foreign exchange rate
C) country's deficit
D) gross domestic product

Question 29

The gross domestic product plus the income from non-resident sources abroad gives the ____.

A) gross national product
B) per capita income
C) purchasing power parity
D) net national income

Question 30

Most opponents of globalization view globalization as a long-run historical evolution since trade began.

Question 31

The strategy of treating the entire world as one market is known as localization.

Question 32

An institution-based view suggests that the success and failure of firms are enabled and constrained by business norms of the host nation.

Question 33

The current state of globalization around the world is that of semiglobalization.

Question 34

A dragon multinational is a name given to MNEs from emerging markets.

Question 35

Scenario planning is a technique to prepare and plan exclusively for high risk scenarios.

Question 36

Focusing on a firm's internal resources and capabilities is the main emphasis of the resource-based view.

Question 37

The _____ is measured as the sum of value added by resident firms,households,and governments operating in an economy.

A) gross national product
B) gross national income
C) gross domestic product
D) national reserve

Question 38

Semiglobalization calls for adopting one way of doing business for all conditions.

Question 39

The term "emerging economies" has replaced the term _____.

A) developed countries
B) developing countries
C) Triad markets
D) first-world markets

Question 40

Overall,the focus on firm performance around the globe defines the field of global business more than anything else.

Question 41

Which of the following countries is included in BRIC?

A) Belgium
B) Russia
C) Italy
D) Canada

Question 42

Which of the following countries is represented in the Triad of the global economic pyramid?

A) India
B) China
C) Japan
D) Russia

Question 43

The _____ view of global business focuses on internal factors that can help a firm overcome its external environment.

A) resource-based
B) industry-based
C) socio-cultural
D) institution-based

Question 44

Viewing the global economy as a pyramid,the Triad refers to _____.

A) Taiwan, Hong Kong, and South Korea
B) US, the EU, and China
C) Brazil, India, and China
D) North America, Western Europe, and Japan

Question 45

The _____ view suggests that the success and failure of firms are largely determined by their environments.

A) institution-based
B) stakeholder-based
C) resource-based
D) capability-based

Question 46

The resource-based view of global business differs from the institution-based view of global business in that the resource-based view _____.

A) postulates the ideology of localization
B) supports the ideology of total globalization
C) focuses on the internal strengths on the firm
D) advocates adopting a single method for achieving globalization

Question 47

A _____ is defined as an innovation that is adopted first in emerging economies and then diffused around the world.

A) reverse innovation
B) reverse-engineered innovation
C) top down innovation
D) traditional innovation

Question 48

Which of the following countries would be characterized as an emerging economy?

A) Brazil
B) USA
C) Germany
D) Japan

Question 49

Which of the following would be an example of a product undergoing reverse innovation on the global economic pyramid?

A) Triad nation to Triad nation
B) Triad nation to second tier nation
C) Second tier to base tier nation
D) Base tier nation to Triad nation

Question 50

Which of the following would be an example of a top down innovation?

A) Lowering prices and features of existing products to meet emerging market needs
B) Launching a product in and for emerging economies
C) Adopting an innovation first in emerging economies and then diffusing it around the world
D) Introducing products from emerging markets into developed markets

Question 51

Approximately _____ people are employed by foreign-owned firms throughout the world.

A) 80 million
B) 40 million
C) 18 million
D) 1 million

Question 52

Which of the following does the institution-based view of global business lay emphasis on?

A) Acquiring resources that belong to the host nation
B) Consolidating the internal assets of a firm
C) Focusing on the capabilities of the firm's headquarters
D) Understanding the laws and values of the firm's host nation

Question 53

People who live in the Triad countries comprise the _____ of the global economic pyramid.

A) top tier
B) second tier
C) base
D) outlier

Question 54

People who earn _____ a year comprise the base of the global economic pyramid.

A) between $2,000 to $20,000
B) less than $2,000
C) between $20,000 to $40,000
D) more than $40,000

Question 55

Which of the following groups is primarily composed of emerging economies?

A) The Triad
B) BRIC
C) Group of Eight (G8)
D) NAFTA

Question 56

The _____ view of global business focuses on external factors that affect a firm's performance.

A) resource-based
B) asset-based
C) capability-based
D) institution-based

Question 57

Which of the following is true of the Group of 20 (G-20)?

A) It only has 19 member countries.
B) It doesn't represent any European nation.
C) It meets annually to discuss environmental issues.
D) It includes many regional blocs.

Question 58

More than half of all GDP of emerging economies comes from _____.

A) the Four Asian Tigers (Hong-Kong, Singapore, South Korea, and Taiwan)
B) MIKT (Mexico, Indonesia, South Korea, Turkey)
C) the Commonwealth of Independent States
D) BRIC (Brazil, Russia, India, and China)

Question 59

Which of the following is true of economies in the base of the global economic pyramid?

A) They are composed of developed economies.
B) They are composed of people from North America, Western Europe, and Japan.
C) They are largely ignored by MNEs.
D) They attract the largest FDI from MNEs.

Question 60

Which of the following regions in the global economic pyramid would comprise developed nations?

A) The base
B) The Triad
C) The second tier
D) The outlier

Question 61

Which of the following would lead to the standardization of world markets?

A) Semiglobalization
B) Localization
C) Total globalization
D) Total isolation

Question 62

The concept of _____ suggests that barriers to market integration at borders are high,but not high enough to completely insulate countries from each other.

A) localization
B) technocapitalism
C) semiglobalization
D) total globalization

Question 63

Which of the following is true of globalization according to the "new force" perspective?

A) It is a process of trade integration that has both advantages and disadvantages.
B) It is a phenomenon that is technologically out of sync.
C) It is a historical aspect of human trade.
D) It is a western ideology focused on exploiting and dominating the world through MNEs.

Question 64

The liability of foreignness is the inherent disadvantage faced by _____.

A) domestic firms against other domestic firms that have engaged in global business
B) foreign firms in host nations due to their non-native status
C) domestic firms from foreign firms setting up in their country
D) foreign firms from their home country governments

Question 65

The _____ of globalization suggests that globalization is neither recent nor one-directional.

A) new-force view
B) long-run historical view
C) pendulum view
D) colonial view

Question 66

What is the relationship between gross domestic product (GDP)and purchasing power parity (PPP)?

Question 67

Which of the following would be regarded as a dragon MNE?

A) MNEs from developed countries
B) MNEs belonging to the Triad economies
C) MNEs coming exclusively from the European Union
D) MNEs from emerging markets

Question 68

Which of the following is true of globalization according to the "pendulum view" perspective?

A) Globalization is being interrupted by artificial barriers to the flows of goods, services, capital, and knowledge.
B) Globalization is a Western ideology focused on exploiting and dominating the world through MNEs.
C) Globalization is a not a one-directional phenomenon.
D) Globalization is a recent phenomenon of human trade.

Question 69

Explain the pendulum view of globalization.

Question 70

_____ is the strategy of treating the entire world as one market.

A) Total isolation
B) Semiglobalization
C) Standardization
D) Localization

Question 71

Elaborate on the three prevalent views of globalization.

Question 72

Explain the benefits of gaining international business experience and working as an expat.

Question 73

The strategy of treating each country as a unique market and in total isolation is referred to as _____.

A) total globalization
B) standardization
C) semiglobalization
D) localization

Question 74

Explain the role of nongovernmental organizations (NGOs)in globalization.

Question 75

The global economy may be viewed as a pyramid.The growing number of opportunities at the base of the pyramid highlights the role this bottom tier will play in the years to come.How can MNEs take advantage of this often-ignored level?

Question 76

Explain the success and failure of global firms based on institution- and resource-based views.

Question 77

How is reverse innovation helping emerging economies?

Question 78

Which of the following is true of semiglobalization?

A) It is a type of globalization that adopts a strategy of treating the entire world as one market.
B) It is a type of globalization that lies between total isolation and total globalization.
C) It is a form of globalization that treats each country as a unique market.
D) It is a form of globalization that considers each nation in isolation when conducting business.