Deck 17: Globalization and International Business

Question 1

The creation of domestic jobs by foreign employers is called __________.

A) insourcing
B) outsourcing
C) international operations
D) strategic alliances

Answer 1

A

Question 2

Businesses go global for all of the following reasons EXCEPT:

A) To minimize domestic customers.
B) To increase profits through expanded operations.
C) To increase access to low-cost, talented workers.
D) To increase access to products, services, materials.

Answer 2

A

Question 3

ABC manufacturing conducts commercial transactions across national boundaries.ABC would be classified as which of these?

A) Large business
B) Franchised
C) International
D) Foreign licensed company

Answer 3

C

Question 4

The paying of a fee to use another firm's name,resources,and operating systems is called __________.

A) licensing
B) franchising
C) importing
D) leasing

Question 5

A joint venture arrangement normally might involve all of the following EXCEPT:

A) pooling of resources.
B) sharing risks.
C) jointly operating the venture.
D) one firm buying out the other firm.

Question 6

Which of the following is a direct investment strategy?

A) Global sourcing
B) Joint ventures
C) Exporting
D) Licensing

Question 7

Anna has purchased the rights to make or sell another company's products.Anna is participating in __________.

A) insourcing
B) outsourcing
C) franchising
D) licensing

Question 8

Global sourcing involves:

A) exporting products for sale.
B) purchasing materials, components, or services from around the world for local use.
C) selling a foreign firm the right to make your products.
D) building a plant to produce goods for sale in foreign countries.

Question 9

Doing business internationally can be justified by all of these EXCEPT:

A) expanding profit potential.
B) gaining access to more customers.
C) reducing access to capital.
D) lowering the cost of materials and supplies.

Question 10

When a firm grants licenses internationally,it is giving foreign companies access to its:

A) technologies, patents, or trademarks.
B) facility designs and equipment.
C) product ingredients.
D) management systems.

Question 11

A company that conducts business across national boundaries is called a(n)__________.

A) global economy
B) international business
C) trade association
D) conglomerate

Question 12

A __________ establishes a foreign subsidiary by building an entirely new operation in a foreign country.

A) joint venture
B) strategic alliance
C) greenfield venture
D) franchise

Question 13

Which of the following operates through co-ownership with local partners?

A) Franchise
B) Wholly owned subsidiary
C) Joint venture
D) Licensed venture

Question 14

ABC would like to market their products in Brazil.Armed with the design and manufacturing capability,ABC is looking for a company with the distribution channels and knowledge of the Brazil culture necessary to market their products.ABC has decided to form a partnership with XYZ in Brazil.The company will be jointly owned and independently operated.Which of the following is ABC forming with XYZ?

A) Franchise
B) Joint venture
C) Licensing agreement
D) Operating subsidiary

Question 15

__________ is used to describe the interdependence among elements of the global economy.

A) Nationalization
B) Industrialism
C) Globalization
D) Internationalism

Question 16

ABC Manufacturing,a USA based company,buys products from China for sale in U.S.markets.This practice refers to which of these?

A) Importing
B) Insourcing
C) Exporting
D) Franchising

Question 17

A(n)__________economy is one in which resources,markets,and competition are worldwide in scope.

A) foreign
B) domestic
C) outsourced
D) global

Question 18

What is the term used to describe the selling of products to foreign countries?

A) Importing
B) Greenfield venture
C) Outsourcing
D) Exporting

Question 19

Business arrangements between firms of different nationalities are done for many reasons and in many different ways.These arrangements,whatever their structure,are called __________.

A) subsidiaries
B) global strategic alliances
C) franchises
D) licensed partnerships

Question 20

Which of the following countries is the top outsourcing destination?

A) Mexico
B) China
C) United States
D) Japan

Question 21

If Brazil applies tariffs and special treatment for local firms against foreign competition,it is known as:

A) idealism.
B) internationalism.
C) globalism.
D) protectionism.

Question 22

According to research from Transparency International,which of the following countries ranked #1 as the least corrupt for doing business?

A) Somalia
B) Spain
C) USA
D) New Zealand

Question 23

The two main ways of organizing multinational corporations for global operations are global __________ and global __________ structures.

A) economy; risk
B) area; economy
C) product; market
D) area; product

Question 24

All of the following are MNC complaints about host countries EXCEPT:

A) profit limitations.
B) overpriced resources.
C) interference with government.
D) exploitative rules.

Question 25

Products For You,Inc.(PFY)is an international company with five presidents in charge of its American,European,African,Asian,and the ROW (rest of the world)operations.PFY is using a global __________ structure.

A) area
B) matrix
C) product
D) vertical

Question 26

In her book The Travels of a T-Shirt in the Global Economy,economist Pietra Rivoli tracks a t-shirt that she bought while on a vacation to Florida to realize that it was truly 100 percent U.S.originated and made throughout its journey.

Question 27

Which of the following approaches to international business offers the most control but with the greatest risk?

A) Joint ventures
B) Foreign subsidiary
C) Importing
D) Licensing

Question 28

A __________ is a business with extensive foreign operations in more than one country.

A) conglomerate
B) wholly owned subsidiary
C) partnership
D) multinational corporation

Question 29

The problem of "currency risk" refers to:

A) fluctuations in the electrical grids of foreign countries.
B) terrorism or armed conflicts.
C) fluctuations in foreign exchange rates.
D) nationalization of foreign assets.

Question 30

A global institution whose purpose is to promote free trade and open markets around the world is known as the ______________.

A) United Markets Institute
B) World Bank
C) World Trade Organization
D) U.S. Chamber of Commerce

Question 31

__________ is the full time employment of children for work normally done by adults.

A) Children camp
B) Child labor
C) Scout camp
D) Sweatshop

Question 32

A(n)_____________is a company that employs workers at very low wages,for long hours,and in poor working conditions.

A) subsidiary
B) joint venture
C) MNC
D) sweatshop

Question 33

ABC,a U.S.based company,operates a subsidiary in Egypt.ABC is facing the possible loss of investment and control over its assets in Egypt due to instability and political changes.ABC is facing which of these?

A) Cultural integration issues
B) Globalization
C) Political risk
D) Competitive threat

Question 34

If Japan receives the most favorable treatment for imports and exports with other countries,Japan is said to have a(n)___________ status.

A) international
B) outsourced
C) greenfield venture
D) most favored nation

Question 35

A __________ is a local operation completely owned by a foreign company.

A) foreign partnership
B) franchise
C) foreign subsidiary
D) licensee

Question 36

The forecasting of political events that may impact foreign investments is called __________.

A) currency analysis
B) political-risk analysis
C) analytical forecasting
D) international forecasting

Question 37

When Argentina's president nationalized the oil industry without consideration for the foreign companies operating there,the loss to the foreign countries was considered a __________ risk.

A) national
B) currency
C) global
D) political

Question 38

When an American business is being mistreated in foreign countries,the U.S.government can help by appealing to which of the following?

A) The European Union
B) The World Trade Organization
C) The World Bank
D) The United Nations

Question 39

______________ managers are those who are aware of international developments and competent in working across cultures.

A) Senior
B) National
C) Global
D) Foreign

Question 40

The Foreign Corrupt Practices Act prevents U.S.firms from doing which of the following?

A) Paying bribes or giving excess commissions in exchange for favors.
B) Using "sweatshops" to produce goods for sale in the U.S.
C) Employing child labor in plants that make goods for U.S. markets.
D) From participating in unsustainable development in third world countries.

Question 41

The process of growing interdependence among elements of the global economy is known as _____________.

Question 42

The most common multinational organizational structures are done by product and area.

Question 43

In a global economy,resources,markets and competition are worldwide in scope.

Question 44

For all practical purposes,a multinational corporation is the same as a transnational corporation.

Question 45

One of the challenges to international business is the cultural relativism forced upon them by local laws and customs.

Question 46

In global sourcing,firms purchase and sell goods and services around the world for local use.

Question 47

The Foreign Corrupt Practices Act can actually put U.S.firms at a competitive disadvantage in certain areas of the world.

Question 48

Host countries always complain that MNCs do not have respect for local customs.

Question 49

Currency risk means that the amount you actually receive for your sale of products or services may vary depending on currency fluctuations.

Question 50

A foreign subsidiary can be created either by buying out an existing firm or by building a new firm from scratch.

Question 51

Domestic franchising involves selling the right to use your name and operating methods to foreign companies.

Question 52

A foreign subsidiary is a local operation in which a foreign firm owns at least 51%.

Question 53

The form of international business involving the sale of domestically made goods in foreign markets is called _____________.

Question 54

Importing involves buying goods from foreign companies for sale overseas.

Question 55

There are 90 members in the World Trade Organization.

Question 56

Shifting local jobs in foreign locations to take advantage of lower-wage labor in other countries is called _____________.

Question 57

The main difference between domestic and international businesses is that the latter crosses national boundaries.

Question 58

If you purchase the latest CD from your favorite artist or the latest blockbuster DVD for a very low price while traveling internationally,you are likely facilitating the violation of intellectual property rights.

Question 59

Being a loner,acting uncooperative,and being irritable are considered universal inhibitors of leadership success.

Question 60

Most multinational corporations retain strong national identities even while operating around the world.

Question 61

The acronym WTO stands for the __________.

Question 62

Define franchising and licensing.Explain the difference.

Question 63

______________is the possible loss of profits because of fluctuations in exchange rates.

Question 64

__________ forecasts how political events may impact foreign investments.

Question 65

Define and differentiate between multinational and transnational corporations.

Question 66

A local operation that is completely owned and controlled by a foreign company is called a(n)__________.

Question 67

Define a joint venture and a foreign subsidiary and the differences between them.

Question 68

.__________ is the term used to describe places in which employees are given low wages for long hours in poor,and often unsafe,working conditions.

Question 69

A(n)__________ operates in a foreign country through co-ownership with local partners.

Question 70

__________ involves the use of laws and politically-driven tariffs to shield a country's domestic businesses from foreign competitors.

Question 71

What are the pros and cons of conducting business internationally?

Question 72

MNC is an acronym that stands for __________.