Deck 4: Managing in the Global Environment

Question 1

When new competitors enter an industry, prices in the industry typically increase.

Answer 1

False

Question 2

The set of forces and conditions that originate with global suppliers, distributors, customers, and competitors and affect an organization's ability to obtain inputs and dispose of its outputs is the ________ environment.

A)demographic
B)legal
C)task
D)societal

Answer 2

C

Question 3

Which of the following is part of an organization's task environment?

A)culture
B)economy
C)politics
D)competition

Answer 3

D

Question 4

Antonio is a management consultant. He is working with a well-established software developer that has employees in nine countries. Antonio has noticed that senior management at the company excels at managing suppliers and competing with rivals. However, the managers know little about new laws related to software in the countries where they do business, and they have not focused on the fact that the company's customer base is aging. What should Antonio suggest in his report to the company CEO?

A)Instead of monitoring the task environment, spend time and money addressing the general environment.
B)Instead of monitoring the general environment, spend time and money addressing the task environment.
C)Keep up the good work as far as the task environment is concerned, but put more time, resources, and expertise into addressing the general environment.
D)Relocate all of the company's offices, plants, and jobs to one country so the task environment and general environment become the same.

Question 5

Dinesh manages a division of a sporting goods manufacturer. He attends a conference and receives advice from four experienced managers. Based on what you have read, which of the following pieces of advice should Dinesh take?

A)"Make the company a global organization so it can benefit from emerging markets."
B)"Make the company a local organization so it can be protected from new competitors."
C)"There will always be competitors, so focus on long-term demographic trends instead of worrying about the competition."
D)"There will always be demographic changes, so focus on beating competitors instead of analyzing customer trends."

Question 6

Most profit-oriented organizations are threatened during economic downturns, but not-for-profit organizations tend to flourish.

Question 7

While the typical organization in the United States emphasizes the importance of the group, the typical organization in Japan emphasizes the importance of the individual.

Question 8

A government imposes tariffs on imports to protect its industries and workers from inflation.

Question 9

Global Blenders sells goods and services that other companies offer but does not provide any organization with the input resources needed to produce goods and services. Based on this information, we can thus say that Global Blenders is a

A)supplier, not a competitor.
B)competitor, not a distributor.
C)distributor, not a supplier.
D)supplier, not a distributor.

Question 10

A shift in the age distribution of the population of the United States is an example of a sociocultural force that affects organizations in the United States.

Question 11

The wide-ranging global, economic, technological, sociocultural, and political forces that affect the organization and its task environment make up the ________ environment.

A)competitive
B)near
C)task
D)general

Question 12

Max is interviewing for a management job with an international manufacturer. One of the interviewers asks him whether he would rather focus on the task environment or the general environment in this management position. Which of these is the best answer for Max to give?

A)"I'd like to focus on the task environment because it has the most immediate and direct effect on managers, so I could make a real difference."
B)"Focusing on the general environment interests me because I want to improve the organization's ability to obtain inputs and dispose of outputs."
C)"I can focus on both because the task environment and the general environment are basically the same thing."
D)"Since companies are becoming more homogeneous because of globalization, neither the label 'task environment' nor 'general environment' really applies anymore."

Question 13

Governments of countries that resort to raising tariff barriers ultimately increase employment.

Question 14

The greater the economies of scale of existing organizations, the lower are the barriers to entry for new competitors.

Question 15

Compared to the changes in the task environment, those in the general environment are often

A)harder to identify.
B)easier to respond to.
C)threats, not opportunities.
D)of less consequence.

Question 16

In a society, a folkway violation can lead to serious retribution.

Question 17

Which of the following is part of an organization's general environment?

A)customers
B)technology
C)competitors
D)suppliers

Question 18

Marie-Reine manages an international supply chain. She is concerned because the company's revenues and profits have dipped recently. Some of the managers she supervises say that the problems have to do with the general environment in which the company operates, while others insist that the problems are related to the task environment. What step could Marie-Reine take to determine whether the general environment, the task environment, or both are at the root of the problem?

A)Marie-Reine could interview suppliers to determine what problems (if any)they have with distributors.
B)She could direct one of her employees to research whether the problems are economic or political in nature.
C)She could tell a researcher to find out whether recent economic changes relate to the economy in general or to the company's specific fields and locations.
D)It's impossible to differentiate the task environment from the general environment, so Marie-Reine can't do anything in this situation.

Question 19

Societies that are high on uncertainty avoidance, such as the United States, value diversity and tolerate differences between people in their actions.

Question 20

The norms of a society are written rules of codes of conduct that tell people how they are supposed to act in given situations.

Question 21

Heartz Ltd. provides Glayton Technologies with input resources that it needs to produce its products. In this context, which of the following categories does Heartz Ltd. belong to?

A)suppliers
B)competitors
C)distributors
D)customers

Question 22

Phoenix Systems manufactures computer chips and is based in Canada. This year the company has begun working with suppliers in other countries, but the suppliers' quality levels have been erratic. Based on what you have read, which of these is the most cost-effective way to combat this problem?

A)Hire a broker or intermediary in a supplier's country to determine if that country has a supplier capable of keeping quality standards high.
B)Fire all the suppliers but one, and use the increased amount of work to bargain for a lower cost per chip.
C)Hire only Canada-based suppliers so Phoenix can take advantage of lower transportation costs and can more closely supervise product creation.
D)Eliminate all suppliers and create computer chips in house with a specially trained staff.

Question 23

Charlotte, a vice president at a tool-and-die manufacturer, wants to outsource the company's manufacturing. Which of these actions should Charlotte take to accomplish that goal?

A)Limit outsourcing to countries where people speak the same language her management team does.
B)Balance considerations of negative publicity, competition between suppliers, and client education.
C)Focus on price because that is customers' sole concern.
D)Balance considerations of price, quality, reliability, and speed.

Question 24

Which of these is an example of a barrier to entry?

A)the lack of well-trained employees who have years of experience in a specialized area
B)government regulations that set few or no restrictions on establishing a business in that field
C)the ability to manufacture components or products in small quantities
D)the ability to specialize in one specific type of product for a niche audience

Question 25

An organization's major customer puts pressure on the organization to reduce prices on its products. This is an example of influence exerted by the organization's ________ environment.

A)demographic
B)task
C)legal
D)sociocultural

Question 26

When a company outsources tasks globally, which of these factors can wipe out the price differential from lower labor costs?

A)powerful trade unions
B)high shipping costs
C)low pollution controls
D)negative publicity

Question 27

Miriam is a senior manager for an international chain of fitness centers. Two suppliers provide exercise machines for her company. Which of the following is the wisest advice on how Miriam should manage her suppliers?

A)Keep the relationships as they are and focus on other matters, since suppliers are not essential to this type of organization.
B)Seek out potential new suppliers who can meet or exceed the quality standards of existing suppliers.
C)Eliminate one of the suppliers based on the quality of machinery and speed of shipping.
D)Eliminate one of the suppliers based on the lowest total price for each machine.

Question 28

A supplier's bargaining position is strong when

A)the input is vital to the organization.
B)there are a large number of suppliers for an input.
C)the supply is free.
D)the supply is not protected by a patent.

Question 29

Which of these is an example of a distributor?

A)the International Brotherhood of Electrical Workers union
B)DHL, an international shipping company
C)individuals who buy phones for their personal use
D)Ruby Tuesday, a "fast casual" restaurant chain

Question 30

Pentathlon Ltd. and New Image Fitness both specialize in designing bikes for triathletes in the North American market. Thus, each company would see the other as a

A)supplier.
B)competitor.
C)distributor.
D)customer.

Question 31

Which of these approaches could help a company be more responsive to its customers?

A)Focus on the most profitable customers and give them special benefits.
B)Exploit opportunities by finding large companies who are interested in becoming customers.
C)Segment the customer base into distinct groups, and figure out how to appeal to each group.
D)Avoid threats by focusing on customers' enduring tastes and needs.

Question 32

Organizations that help other organizations to sell their goods to customers are known as

A)competitors.
B)distributors.
C)customers.
D)suppliers.

Question 33

Cool Breeze Inc. manufactures ceiling fans in a small town. Which of these companies is a potential competitor to Cool Breeze?

A)a manufacturer in the same town that pays its workers slightly more than Cool Breeze does
B)a maker of floor-level and pocket-sized mechanical fans
C)a distributor of ceiling fans to North America, Europe, and Asia
D)a technical school that trains its students to repair ceiling fans

Question 34

Actions of suppliers, distributors, customers, and competitors can affect managers' ability to obtain resources and dispose of outputs, and thus, have a significant impact on the company's

A)socioeconomic environment.
B)short-term decision making.
C)political influence.
D)power distance.

Question 35

A company based in India performs the routine data entry tasks for a Texas-based insurer. This arrangement is an example of

A)global outsourcing.
B)power distance.
C)inverted sourcing.
D)shared services.

Question 36

Caltronix helps Gen Marco sell Marco washing machines. Caltronix does not use the machines. Which of the following describes either company correctly?

A)Caltronix is a distributor.
B)Caltronix is a customer.
C)Gen Marco is a supplier.
D)Gen Marco is a customer.

Question 37

When a company contracts with suppliers in other countries to make the various inputs that go into its products or to assemble the final products to reduce costs, ________ occurs.

A)inverted sourcing
B)power distance
C)global outsourcing
D)shared services

Question 38

Factors that make it difficult and costly for a company to compete in a particular task environment or industry are

A)political forces.
B)barriers to entry.
C)isolating mechanisms.
D)free trade agreements.

Question 39

A firm that has not traditionally been a competitor of EcoPro suddenly creates a new type of product that makes EcoPro products obsolete. This is an example of

A)demographic forces in the general environment.
B)competitors in the task environment.
C)suppliers in the task environment.
D)politics in the general environment.

Question 40

Bonne Chance Cosmetics manufactures and sells a skincare line. It does not currently make or sell lipstick, but it could do so in future. A cosmetics company that makes and sells lipstick could view Bonne Chance as a potential

A)supplier.
B)competitor.
C)distributor.
D)consumer.

Question 41

The collection of values that a society considers important and the norms of behavior that are approved by the society are known as

A)sociocultural forces.
B)economies of scale.
C)the national culture.
D)demographic forces.

Question 42

Cedric, a brand manager, transferred from the United States to Japan. He discovered that although people in the United States highly value individualism, people in Japan expect individuals to conform to group expectations. Cedric concluded that Japan places more of an emphasis on

A)cultural relativism.
B)self-control.
C)collectivism.
D)political differences.

Question 43

Building customer awareness of the newcomer's product is very costly in the face of which of the following sources of barriers to entry?

A)economies of scale
B)technological barriers
C)government regulations
D)brand loyalty

Question 44

Within an industry, the existing economies of scale, brand loyalties, and government regulations that impede access to the task environment create

A)global outsourcing.
B)power distance.
C)barriers to entry.
D)barriers to exit.

Question 45

A high percentage of the customers of Action Sport buy Action Sport shoes at least three-fourths of the time that they buy shoes. In the context of barriers to entry, this product has a large degree of

A)distributor loyalty.
B)demographic force.
C)brand loyalty.
D)potential competition.

Question 46

If it is difficult and costly to enter a task environment, then for companies already within a task environment or industry,

A)the barriers to entry are low.
B)threat of competition is high.
C)it is easier to obtain customers.
D)it is harder to keep prices high.

Question 47

Today in most industrialized nations, as a consequence of falling birth and death rates, the absolute number of older people has increased substantially. This is an example of ________ change.

A)sociocultural
B)economic
C)political
D)demographic

Question 48

In the drug manufacturing industry, Gateway Labs is a company operating at massive economies of scale in the production of many drugs. Thus, a potential entrant into the industry will have a

A)much wider customer base.
B)higher level of production costs.
C)competitive advantage in pricing.
D)cheaper distribution system.

Question 49

Victoria quits her job managing an independently owned restaurant to take a new job managing a chain of restaurants. She discovers that, because her new employer buys so much food and so many other supplies, the cost per item is much less. These cost advantages are the result of

A)brand loyalty.
B)economies of scale.
C)boundary spanning.
D)power distance.

Question 50

David, a sales manager, was surprised when customers repeatedly bought more expensive True Sound headphones instead of the less expensive substitutes that his company produces. David told the vice president of sales that True Sound must have a high level of

A)demographic force.
B)brand loyalty.
C)potential competition.
D)distributor loyalty.

Question 51

For a company planning to enter a task environment or industry, the greater the economies of scale within that task environment,

A)the higher will be the barriers to entry.
B)the smaller will be the investment.
C)the easier it will be to create brand loyalty.
D)the higher will be tariff rates.

Question 52

Which of the following statements accurately defines brand loyalty?

A)It is the repurchase behavior shown by customers due to the fear of trying a new brand.
B)It is the customers' preference for the products currently in the task environment.
C)It is the perception of customers that some brands are equivalent.
D)It implies that the brand delivers what it promises.

Question 53

The combination of equipment and skills that a manager uses in the production and distribution of goods is known as

A)economies of scale.
B)a competitive advantage.
C)technology.
D)the national culture.

Question 54

Economies of scale result from actions such as

A)manufacturing products in small quantities.
B)keeping the demand high by cutting supply.
C)creating products that are exclusive.
D)buying inputs for the products in bulk.

Question 55

In a task environment where there are few competitors, it is

A)harder to reach economies of scale.
B)harder to create brand loyalty.
C)easier to obtain customers.
D)harder to keep prices high.

Question 56

It is easier to obtain customers and keep prices high in a task environment where there are few

A)competitors.
B)customers.
C)suppliers.
D)distributors.

Question 57

Karen, an executive at Brandon's Department Store, finds that the median age of the population in the chain's region is increasing by about three years every decade. This is an example of which type of force in the general environment?

A)political
B)economic
C)demographic
D)sociocultural

Question 58

If established organizations enjoy significant brand loyalty, a new entrant will

A)find it neither difficult nor costly to obtain a share of the market.
B)easily establish itself as another company enjoying brand loyalty.
C)bear huge costs to build customer awareness of its products.
D)deter potential competitors from entering the task environment.

Question 59

By fully using its employees' skills and knowledge, ImagineDragon Software is making more effective use of organizational resources than do its competitors. It is thus increasing

A)economies of scale.
B)the national culture.
C)intellectual capital.
D)soft skills.

Question 60

Social structure is the traditional system of relationships established between ________ in a society.

A)splinter groups and rights holders
B)people and groups
C)belief systems and cultural traditions
D)casualness and formality

Question 61

The population of the United States is shifting from the Northeast to the Southwest. This is an example of which type of force in the general environment?

A)political
B)legal
C)sociocultural
D)demographic

Question 62

Willard wants to be an expatriate, but he violated a folkway on a recent international trip. Because of this violation, his international hosts thought of him as

A)powerful and socially refined.
B)immoral or wicked.
C)eccentric or ill-mannered.
D)unfamiliar with religion.

Question 63

One of the reasons that world trade has increased so dramatically is that tariff barriers have

A)vanished.
B)changed little, leading to a sense of stability.
C)become much stronger.
D)fallen significantly.

Question 64

Values are deeply embedded in society and

A)change through a slow and painful process.
B)are static and remain unchanged.
C)change quickly via smooth transitions.
D)are the same across all societies.

Question 65

If a society values the group more than the individual, and believes that people should be judged by the quality of their contribution to the group instead of their individual achievement, then the society is said to value

A)individualism.
B)power distance.
C)collectivism.
D)objectivism.

Question 66

A rural bank in Texas loses customers when those customers decide to invest their money in foreign banks that they access online. The rural bank's management considers this to be an example of

A)a negative effect related to human capital.
B)a negative effect related to financial capital.
C)a positive effect related to human capital.
D)a positive effect related to financial capital.

Question 67

Jessica is moving to another country to manage a call center for her employer. The country she is moving to has low power distance. Which of these situations is Jessica most likely to discover in this new country?

A)rudeness and insubordination among the employees who report to her
B)CEOs who make dozens or hundreds of times as much as the average worker makes
C)many and varied social welfare programs, such as childcare assistance and subsidized doctor visits
D)fear and nervousness among the employees who report to her

Question 68

Companies from the nation of Moldavia are more efficient in the production of certain types of apparel, while companies from the United States are more efficient in the production of certain types of computers. Which economic theory predicts that capital would move to Moldavia to be invested there in the apparel industry and to the United States to be invested in its computer companies?

A)rapid specialization theory
B)investor collectivism theory
C)free-trade doctrine
D)investor individualism doctrine

Question 69

The society of the nation of Atlantis has commonly accepted laws against driving while intoxicated, and violations of those laws bring severe penalties. This is an example of which type of norm?

A)mores
B)sanctions
C)folkways
D)rituals

Question 70

If a society believes that self-expression is important to the people in that society, then the society is said to value

A)social background.
B)individualism.
C)objectivism.
D)power distance.

Question 71

Ifaneyi's company transfers him to the United States, where he finds that he is expected to be much more casual than he is used to in terms of what he wears and how he speaks to people. In the context of social norms, the customs and practices related to correct dress and social manners are known as

A)folkways.
B)artifacts.
C)values.
D)rites.

Question 72

Norms that are central to the functioning of a society and whose violation brings serious retribution are known as

A)sanctions.
B)folkways.
C)mores.
D)rituals.

Question 73

A tax that a government imposes on goods imported into the country is known as a(n)

A)sanction.
B)quota.
C)embargo.
D)tariff.

Question 74

A society has a common practice that men should remove their hats whenever they ride in elevators that are also carrying women. This is an example of which type of norm?

A)rituals
B)folkways
C)standards
D)mantras

Question 75

Ingrid moves to a different country to manage IT employees. She discovers that this society has what she considers surprising ideas about what is bad, wrong, undesirable, or unattractive. These ideas are

A)values.
B)mores.
C)rites.
D)folkways.

Question 76

In a society, the unwritten rules of conduct that state how people should act in particular situations in that society are known as

A)values.
B)norms.
C)rituals.
D)goals.

Question 77

In the North American Free Trade Agreement (NAFTA), what percentage of the tariffs on the goods traded between Mexico, Canada, and the United States were supposed to be abolished by the year 2004?

A)30 percent
B)99 percent
C)70 percent
D)55 percent

Question 78

Susan's company sends her to "expat training" before her international posting. The training teaches the values, norms, knowledge, beliefs, moral principles, laws, customs, and other practices that unite the citizens of the country where she is going. These values, norms, beliefs, etc. are also known as

A)a representative democracy.
B)a free-trade economy.
C)the national culture.
D)culture shock.

Question 79

Deregulation and privatization are a part of which of the following forces in the general environment?

A)political and legal
B)technological and industrial
C)cognitive and sociocultural
D)macroeconomic and microeconomic

Question 80

The U.S. government imposes a 25 percent tax on the selling price of any four-wheel-drive SUV that is brought into the U.S. by a foreign car manufacturer to be sold in the U.S. What type of tax is the U.S. government imposing?

A)an export tariff
B)an import tariff
C)a franchise tax
D)a licensing tax