Deck 6: International Management

Question 1

Transnational companies are companies that produce products in one country and export these products to many overseas countries.

Answer 1

False

Question 2

To maintain its strong growth for the foreseeable future,Starbucks has been expanding aggressively overseas.

Answer 2

True

Question 3

Germany is a member of the Group of Five.

Answer 3

True

Question 4

The goal of the unified Europe is to strengthen Europe's position as an economic superpower vis-à-vis the United States.

Question 5

Companies that adopt the global model tend to be those pursuing a cost focus as a competitive strategy.

Question 6

Members of APEC include South Korea,the United States,Australia and Russia.

Question 7

Foreign direct investment flows to less-developed countries by firms in developed countries has dropped substantially.

Question 8

NAFTA has had an immediate and negative effect on the U.S.automobile industry.

Question 9

The need to lower costs is a key globalization driver.

Question 10

In the international model,managers use their organization's existing core capabilities to expand into foreign markets.

Question 11

Universal needs exist when the tastes and preferences of consumers in different countries,with regard to a product,are similar.

Question 12

When there are differences in traditional practices among countries,pressures for local responsiveness emerge.

Question 13

When pressures for local responsiveness are high and pressures for global integration are low,the global model is appropriate.

Question 14

The value of U.S.imports from China is more than five times the value of U.S.exports to China.

Question 15

North America,South America and Africa are the three spheres of economic influence that are most dominant in the global environment.

Question 16

The Maastricht Treaty formally established the trade area in North America.

Question 17

Off shoring occurs when the organization contracts with an outside provider to produce one or more of an organization's products or services.

Question 18

NAFTA created one of the world's largest trading blocs.

Question 19

Japan is in fourth place both as an importer to and exporter from the United States.

Question 20

One consequence of an increasingly integrated global economy is imports that are penetrating deeper into the world's largest economies.

Question 21

Exporting offers scale economies.

Question 22

The areas described in the text as the most dominant in the global economy include

A)North America,Western Europe and Asia
B)North America,Mexico and Asia
C)North America,South America and Western Europe
D)North America,Asia and Africa
E)Western Europe,Asia and Africa

Question 23

Cultural shock is an example of an executive coping strategy for international assignments.

Question 24

According to the Power Distance/Individualism scale,the U.S.is labeled as a large power distance,collectivist culture.

Question 25

Inpatriates are foreign nationals that are sent abroad for a short period.

Question 26

Parent-company nationals who are sent to work at a foreign subsidiary are known as expatriates.

Question 27

Ethical behavior and decision making is (surprisingly)harder in a purely domestic situation than in the international arena.

Question 28

The multinational model uses subsidiaries in each country in which the company does business and provides a great deal of discretion to those subsidiaries to respond to local conditions.

Question 29

Licensing is primarily utilized by manufacturing industries while franchising is used more often in service industries.

Question 30

Cross-cultural management extends beyond U.S.employees going abroad.

Question 31

Ethnocentrism is the tendency to judge others by the standards of one's own culture or group,which are seen as superior.

Question 32

One reason for repatriation is disappointment with unfulfilled expectations.

Question 33

Which of the following is the overarching goal of unification of the European Union?

A)Eliminate trade barriers within the European Union
B)Create a more competitive Europe
C)Strengthen Europe's position as an economic superpower,particularly vis-à-vis the United States
D)Establish the euro as a common world currency
E)Adopt one European language

Question 34

The least preferred strategy when a company's competitive advantage is based on technology is the wholly owned subsidiary.

Question 35

Culture shock is the disorientation and stress associated with being in a foreign environment.

Question 36

One way to prevent failed global assignments is to create clear job objectives.

Question 37

The advantages of franchising as an entry mode to global expansion are similar to the disadvantages of licensing.

Question 38

Human resource managers around the globe said the main reason for the failures of an overseas assignment is family issues,especially dissatisfaction of the employee's spouse.

Question 39

Host-country nationals are natives of a country other than the home country of an overseas subsidiary.

Question 40

A drawback of exporting is that high transportation costs can make it uneconomical,particularly in the case of bulk products.

Question 41

Which of the following are consequences of the increasing integration of the global economy?

A)World output and trade have decreased at a dramatic pace.
B)Many companies find their home markets under attack from foreign competition.
C)Companies are making foreign direct investments at home.
D)Imports are failing to penetrate deeper into the world's largest economies.
E)There are fewer opportunities in global trade.

Question 42

The model in which managers use their organization's existing core capabilities to expand into foreign markets is called the

A)international model.
B)multinational model.
C)global model.
D)transnational model.
E)multimedia model.

Question 43

Which country does the text describe as becoming the largest producer and consumer of many of the world's goods?

A)Japan
B)Canada
C)Mexico
D)China
E)Vietnam

Question 44

Pressure for global integration includes

A)pressures to reduce costs.
B)variances in traditional practices.
C)political demands imposed by host countries.
D)consumer preferences.
E)legal demands imposed by host countries.

Question 45

The passage of NAFTA has provided short-term benefits to which of the following industries?

A)The auto industry
B)Grain producers
C)The financial industry
D)Capital-goods suppliers
E)All of the above have benefited from NAFTA.

Question 46

Today's managers operate in an environment that is _______ complex and competitive and offers more ______________.

A)more,profit
B)less,profit
C)more,opportunities
D)less,opportunities
E)less,ROI

Question 47

__________ occurs when companies move jobs to another country,typically where wages are lower.

A)International development
B)Outsourcing
C)Offshoring
D)Expatriation
E)Franchising

Question 48

Which of the following is a global strategy used as an approach to international competition?

A)International model
B)Multinational model
C)Global model
D)Transnational model
E)All of the above are global strategies.

Question 49

Under (the)___________ member countries have agreed to adopt a common European currency called the euro.

A)NAFTA
B)Maastricht Treaty
C)GATT Agreement
D)APEC Treaty
E)European Unification Act

Question 50

Pressure for local responsiveness includes

A)varying consumer preferences.
B)varying sales and distribution patterns.
C)varying traditions.
D)varying political demands.
E)all of the above.

Question 51

Which of the following factors should be considered by managers who are deciding whether to offshore?

A)What is the competitive advantage of the organization's products?
B)Is the organization in its early stages?
C)Can production savings be achieved locally?
D)Can the entire supply chain be improved?
E)All of the above are factors that should be considered by managers who are deciding whether to offshore.

Question 52

The grid used for identifying the best strategy for competing in a global marketplace measures what two dimensions?

A)Pressures for global integration and pressures for local responsiveness
B)Pressure for local interaction and pressures for global responsiveness
C)Financial viability and employee satisfaction
D)Employee satisfaction and management credibility
E)Pressures for global systems capacity and pressures for local financial success

Question 53

When identifying the best strategy for competing in a global marketplace,it is helpful to plot a company's position on a(n)

A)leadership grid.
B)force field analysis grid.
C)integration-responsiveness grid.
D)cost-benefit grid.
E)strategy map.

Question 54

Which of the following existing agreements includes Guatemala,Honduras and the United States?

A)NAFTA
B)CAFTA-DR
C)FTAA
D)APEC
E)ASEAN

Question 55

Which country does the text describe as having become an important provider of online computer and software support for the U.S.?

A)Egypt
B)Great Britain
C)India
D)Mexico
E)Taiwan

Question 56

To be competitive in a global economy,Europeans must increase their level of

A)population density.
B)productivity.
C)espionage activity.
D)philanthropic contributions.
E)wealth.

Question 57

Operating in a global marketplace is considered more complex because

A)managers must compete with cost-efficient overseas competitors.
B)the lessening of trade barriers has presented many opportunities in previously protected markets.
C)many overseas competitors operate with greater economies of scale.
D)of varying cultures and coordination of globally dispersed operations.
E)international management is relatively risk-free as compared to domestic management.

Question 58

One study found that manufacturing labor costs about __________ an hour in China,compared to __________ dollars in the United States.

A)Less than $1;about 15
B)$2;about 15
C)Less than $1;about 25
D)$2;about 25
E)Less than $1;about 40

Question 59

____________ occurs when the organization contracts with an outside provider to produce one or more of an organization's products or services.

A)International development
B)Outsourcing
C)Offshoring
D)Expatriation
E)Franchising

Question 60

NAFTA combined the economies of

A)the U.S. ,Canada and Mexico.
B)Canada,Mexico and South America.
C)South America,the U.S.and Central America.
D)Latin America,Pacific Rim and the E.U
E)the U.S., the E.U. and Canada.

Question 61

Which organizational structure realizes the advantage of local responsiveness but the disadvantage of high manufacturing costs?

A)transnational
B)global
C)worldwide
D)international
E)multinational

Question 62

Companies that decentralize their operations throughout the globe in order to appeal to the varying tastes and preferences of global consumers are utilizing a _____________ model.

A)domestic
B)international
C)multinational
D)transnational
E)global

Question 63

_______________ includes threats of protectionism,economic nationalism and local rules.

A)Differences in distribution channels
B)Differences in traditional practices
C)Economic and political demands
D)Differences in consumer tastes
E)Global market integration

Question 64

In which models of organization structure are manufacturing costs relatively high?

A)Global and transnational
B)International and transnational
C)Multinational and international
D)Global and international
E)Multinational and transnational

Question 65

The model which is appropriate where global efficiency is not required but adapting to local conditions offers advantages is the __________ model.

A)international
B)multinational
C)global
D)transnational
E)domestic

Question 66

When a company such as Procter & Gamble approaches the European market as a unified whole,thus reducing costs and improving efficiency,it is using the __________ model of organizational structure.

A)international
B)multinational
C)transnational
D)global
E)intranational

Question 67

Evans Manufacturing has subsidiaries in each country in which it does business and provides a great deal of discretion to those subsidiaries to respond to local conditions.Each subsidiary has its own manufacturing,marketing,research and human resource functions.This illustrates the

A)international model.
B)multinational model.
C)global model.
D)transnational model.
E)intranational model.

Question 68

The __________ organizational model is designed to enable a company to market a standardized product in the global marketplace and to manufacture that product in a limited number of locations where the mix of costs and skills is most favorable.

A)international
B)multinational
C)global
D)transnational
E)multimedia

Question 69

The multinational model of organization structure consists of

A)large low-cost manufacturing facilities located in selected locations with products exported to various subsidiaries.
B)subsidiaries located in countries where the company does business with much of the control exercised by the parent company.
C)subsidiaries located in countries where the company does business with much of the control exercised by the subsidiaries.
D)manufacturing various components at appropriate sites and assembling the components at national subsidiaries.
E)extensive use of offshoring.

Question 70

Competing globally under the assumption that consumer tastes and preferences in varying countries differ is referred to as a ____________ model.

A)multinational
B)consumer-focused
C)transnational
D)global
E)domestic

Question 71

The Disney Corporation has marketed its facility in France somewhat differently than its United States facilities in order to appeal to the European consumer.This type of strategy is known as __________ model.

A)domestic
B)international
C)multinational
D)transnational
E)global

Question 72

The __________ model of organizational structure has a disadvantage in that it may result in a product that fails to satisfy anyone.

A)international
B)multinational
C)transnational
D)global
E)intranational

Question 73

Where global efficiency is not required but adapting to local conditions offers advantages,the __________ model of organizational structure is appropriate.

A)international
B)multinational
C)global
D)transnational
E)multimedia

Question 74

A disadvantage of a multinational model is that

A)problems in transferring core skills are created.
B)each subsidiary must respond to specific consumer needs.
C)transfer pricing presents difficulties.
D)manufacturing costs are generally higher.
E)coordination of efforts within countries is more difficult.

Question 75

The model designed to enable a company to market a standardized product in the global marketplace and to manufacture the product in a limited number of locations is called the

A)international model.
B)multinational model.
C)global model.
D)transnational model.
E)intranational model.

Question 76

Which model of organizational structure did IBM and Xerox profit from to transfer skills and know-how to subsidiaries around the globe?

A)international model.
B)multinational model.
C)global model.
D)transnational model.
E)intranational model.

Question 77

Character Corporation has subsidiaries in each country in which it does business.As the parent company,Character transfers its core skills in technology and R & D overseas so that each subsidiary remains dependent on it for new products,processes and ideas.This illustrates the __________ of organizational structure.

A)international
B)multinational
C)global
D)transnational
E)intranational

Question 78

Laura,Inc. ,a women's clothing manufacturer is a company that views the entire world as one market and assumes that there are no tangible differences among countries with regard to consumer tastes and preferences.Laura,Inc.illustrates the __________ model of organizational structure.

A)international
B)multinational
C)global
D)transnational
E)intranational model

Question 79

The overseas success of Kellogg,Coca-Cola,Heinz,and Procter & Gamble are based on marketing know-how.These companies are using which model of organizational structure?

A)international model.
B)multinational model.
C)global model.
D)transnational model.
E)intranational model.

Question 80

The international model of organizational structure consists of

A)large low-cost manufacturing facilities located in selected locations with products exported to various subsidiaries.
B)subsidiaries located in countries where the company does business with much of the control exercised by the parent company.
C)subsidiaries located in countries where the company does business with much of the control exercised by the subsidiaries.
D)manufacturing various components at appropriate sites and assembling the components at national subsidiaries.
E)global services.