Deck 4: Global Management: Managing Across Borders

Question 1

Learning how to enhance the American global image of being a "caring,wonderful person" is part of becoming a world citizen.

Answer 1

False
Explanation: Becoming a world citizen includes learning how not to be an "ugly American." Americans "are seen throughout the world as an arrogant people,totally self-absorbed and loud," says Keith Reinhard,former head of advertising conglomerate DDB Worldwide.

Question 2

Don,the CEO of Pie Technology,announced in a conference call the corporate strategic goal of operations in several countries.When this long-term vision by Don is realized,it would qualify Pie Technology as a multinational corporation.

Answer 2

True
Explanation: A multinational corporation,or multinational enterprise,is a business firm with operations in several countries.

Question 3

A nonprofit organization with operations in several states is a multinational organization.

Answer 3

False
Explanation: A multinational organization is a nonprofit organization with operations in several countries.

Question 4

Sally has seen such great interest in her scented candles that she has decided to start her own small business selling them.One benefit that Sally's company can achieve with the Internet and the World Wide Web is that her organization can operate globally,helping her get started more easily because she can put products on a website and sell worldwide,with the advantages of distribution and scope that large companies have.

Question 5

Technology,such as e-mail and videoconferencing,works best to show commitment to customers and handle joint ventures and mergers.

Question 6

Before you travel and conduct business abroad,spend some time learning about other patterns of interpersonal communication,such as in Afghanistan,where a man does not ask another man about his wife.

Question 7

Susan,a teacher,is interested in helping children in other countries learn how to read.She has formed an international nonprofit organization that travels to several nations in Africa to donate books and work in schools as tutors.Susan's organization is an example of a multinational corporation.

Question 8

Keith Reinhard of the nonprofit group Business for Diplomatic Action said,"Americans are seen throughout the world as compassionate,caring people,who are helpful and soft spoken."

Question 9

The process whereby managers are able to utilize Microsoft Excel to improve the record-keeping related to marketing their products and services is known as e-commerce.

Question 10

Becoming a world citizen includes being global in focus,but thinking local,learning what's appropriate behavior,knowing your field,and becoming at least minimally skilled in the language of the local country.

Question 11

The availability of goods,people,and money to be able to move more freely worldwide is known as the flexible economy.

Question 12

Developing a more globally interdependent system defines nationalism.

Question 13

Paul McDonald,executive director of recruitment firm Robert Half Management Resources,said,"Anyone with international experience will have a leg up,higher salary,and be more marketable."

Question 14

Great civilizations have had the characteristic of a strong economy,despite their communication problems.

Question 15

ABC Investments has been advising customers financially since 1902.In 1989,ABC was able to open an office in Berlin,after the Berlin Wall came down.Later,ABC opened several offices in Asia when several Asian countries opened their economies to foreign investors,then as governments began to deregulate their economies,ABC was able to allow their global customers to move their money freely around the world.ABC Investment's experience is evidence of the three historic global changes which Rosabeth Moss Kantor of the Harvard Business School spoke of.

Question 16

Certain industries,like telecommunications and financial services,are especially suited for being midsize and local,so these companies are not trying to become bigger or merge with other big companies.

Question 17

While in Italy,Tony was able to communicate important information to George,his business partner,via e-mail.Later that day,Tony remarked to George about how helpful it was that he was able to return to their office in New York in less than nine hours.This "shrinking" of time and space as air travel and the electronic media have made it easier for people around the globe to communicate with one another defines the global village.

Question 18

One advantage of small companies over large organizations is the ability to make decisions more slowly and methodically if needed,which gives small companies a global advantage in terms of time and distance over large companies.

Question 19

Foreign companies have built plants in the United States,slowly revitalizing parts of industrial America,with foreign direct investment only at 5% of America's GDP.In addition,companies based overseas provide jobs for about 1% of U.S.workers.

Question 20

A negative effect of global economic interdependency is the movement,or outsourcing,of formerly well-paying jobs overseas as companies seek cheaper labor costs.

Question 21

Franchising is a form of licensing in which a company allows a foreign company to pay it a fee and a share of the profit in return for using the first company's brand name and a package of materials and services.

Question 22

A company that produces boats,which is headquartered in Japan,formed a new company in the United States to avoid paying a tariff on its boats manufactured for the U.S.market.This new company is an example of a subsidiary.

Question 23

The Johnson family in Ohio approached Top Builders,an American construction company specializing in new homes,to build their new home.To complete its jobs,Top Builders likes to support small,locally owned American companies that specialize in high-quality products.The use by Top Builders of suppliers outside its company to provide goods and services is known as global outsourcing.

Question 24

Amy,the CEO of a large manufacturing organization,knows that many of her competitors have closed their American factories to utilize production facilities in Mexico because labor is cheaper there and they receive special privileges in return for employing Mexican citizens.However,Amy refuses to shift her operations down south,believing that it is important to keep jobs in the U.S. ,despite the cost savings.These manufacturing plants that are allowed to operate in Mexico,with special privileges in return for employing Mexican citizens,are known as internationldoras.

Question 25

To complete the Johnson family's new home in Ohio,Top Builders,an American construction company specializing in new homes,utilized a Swiss company that specializes in fine-quality doors,using the wood of trees from the Alps region.Top's use of a foreign company's products and labor is known as offshoring.

Question 26

A likely reason for modern outsourcing is the lower cost of labor in another country.

Question 27

Two managers from an Electronics Mart were talking to Ty,their district manager,about Harriet,the unpopular store manager.Susan,the assistant manager,said,"I believe I speak for other managers and employees when I say that Harriet acts like she knows it all.We all feel that Harriet does not listen to any of us because she always thinks her way is right and does not want to consider any other opinion." Harriet is an example of a geocentric manager;geocentricism is also called parochialism.

Question 28

Adriana,a CEO,is interested in expanding her clothing business globally.She loves the excitement and challenge of forming something new that is totally owned and controlled by her organization,knowing that the risky investment will possibly yield a large return.Adriana's desire to form a firm that is totally owned and controlled by her company is an example of a wholly owned subsidiary.

Question 29

A manufacturing facility in a Mexico was unable to afford the products it needs from an American supplier because Mexico's currency dropped dramatically.To acquire the parts needed to produce its products,the Mexican facility bartered with several companies in Texas,offering completed goods for parts.This direct exchange of goods for goods is known as countertrading.

Question 30

The study of international management is not important for some people because most individuals and companies are not affected by global companies.

Question 31

In 1999,the top exporting nation was the United States,but in 2013 the world's top exporting nation was Japan.

Question 32

Aiden,the purchasing manager for a company that produces high-end,quality medical equipment,is interested in meeting with the management of Diamond Cut,a production facility in the state that specializes in intensive research,precision assembly,and complex technology.Aiden's organization is less likely to offshore the manufacture of its products,and want to meet face-to-face with Diamond Cut because Diamond produces high-end products.

Question 33

Multinational organizations expand to take advantage of availability of supplies,new markets,and lower labor costs or to avoid tariffs and import quotas.

Question 34

Jose,the owner of a citrus farm in Mexico,discovers the United States is offering a new larger tariff on the import of Mexican-grown oranges A tariff is a bonus paid to foreign companies by the American government on imported products.

Question 35

Countertrading is a decision by an organization to never accept the market price from its suppliers,but to save money by negotiating a lower price.

Question 36

Many companies are moving production outside the United States because of the effects of geopolitics,a trend known as deglobalization.

Question 37

Phillip,the global sales manager for a cosmetic company,believes that employees and managers in each of his foreign stores understand best how to handle the personnel and practices in their locations.So when a corporate executive approached Phillip about reprimanding Aki,the Tokyo store manager,for not doing things as corporate dictates,Phillip backed Aki.Phillip feels the home office should leave her alone.Phillip is an example of an ethnocentric manager.

Question 38

To help American companies,the U.S.government utilizes import quotas,which encourage foreign countries to increase the number of goods exported to the United States.

Question 39

Farm Supply has decided to allow a retailer in Canada to utilize the Farm Supply name and a number of valuable business services in return for paying the company a fee and part of its profits.This business arrangement is known as franchising.

Question 40

Greg,a manager at the Rome,Italy,store for an American-owned cell phone company,understands the differences and similarities between American and the Italian customers,customs,culture,and practices.As a result,Greg is very skilled at utilizing either the American or Italian technique that helps him market his products and services to customers in Rome.Greg is an example of a geocentric manager.

Question 41

Consisting of 159 member countries,the World Trade Organization is designed to monitor and enforce trade agreements.

Question 42

An import quota is a trade barrier in the form of a customs duty,or tax,levied mainly on imports.

Question 43

The greenfield venture is a strategic alliance with individuals and organizations in third-world nations,in order to assist,educate,and share the risks and rewards of starting a new nonprofit organization in their country.

Question 44

The United States imposed a ban on the import of products from Iran due to the political situation in that nation.This disallowing of imports is known as an embargo.

Question 45

A condition in which a country grants other countries favorable trading treatment,such as the reduction of import duties,is known as a "most favored nation" trading status.

Question 46

A trading bloc,also known as global or local trade associations,consists of groups of global or local organizations that meet on a regular basis to market their products at trade shows or conferences.

Question 47

The IMF operates as a first or primary lender that makes short-term loans to countries suffering from unfavorable balance of payments because of imports,exports,and other matters.

Question 48

A foreign subsidiary is a subsidiary that is partly owned by a foreign government and partly owned by an organization or stockholders.

Question 49

There are two types of tariffs: a revenue tariff,designed simply to raise money for the government;and a protective tariff,which raises the price of imported goods to make the prices of domestic products more competitive.

Question 50

One of the smaller but very vital trading blocs in Europe,with 27 trading partners in Europe and Africa,is the Mercosur.

Question 51

Recently,the IMF has been more concerned with addressing income inequality,which has worsened in most countries in the past three decades.

Question 52

Horatio,the CEO of a struggling company,is excited about his trip to New York City to start participating in a global bartering group that will develop business relationships and exchange their products and services.This is an example of free trade.

Question 53

Canada is the top nation the United States exports to,and Mexico is the country it imports the most from.

Question 54

David,an owner of a small business,is researching the current value of his products when they are bartered on the global market.This market rate of an organization's products when they are bartered is known as the exchange rate.

Question 55

NAFTA is a trading bloc consisting of the United States,Canada,Panama,and Mexico.

Question 56

Over the last two years an American computer manufacturer has partnered with a technology organization in Japan to develop and produce computers and printers benefiting both organizations.This is an example of countertrading.

Question 57

An Indian company has been exporting a technology product to American customers and is marketing its product at a price that is well below the price charged by American companies to drive down the price of the American product.This is an example of countertrading.

Question 58

Out of GATT came a series of "rounds," or negotiations,that resulted in the lowering of barriers,such as the Uruguay Round.

Question 59

Prior to NAFTA,the United States implemented a number of tariffs to protect the auto industry and farmers against foreign competition.A tariff is an example of trade protectionism.

Question 60

Within the European Union,most internal trade barriers have been eliminated,giving the EU an association of borderless neighbors and the world's largest free market.

Question 61

As part of becoming a world citizen,Joe,who is from Michigan and who is transferring to the Paris office,is trying to do things to ___.

A)enhance the American global image of being a caring,wonderful person
B)think local and keep a global focus
C)enhance the American global image of being thrifty
D)reinforce the American stereotype of being self-absorbed and quiet
E)learn how not to be a "cheap American"

Question 62

Globalization is the trend ___.

A)of the world economy becoming a less dependent system
B)of the world economy adding more independent markets
C)toward one world language and culture
D)of the world economy toward becoming a more interdependent system
E)toward one world economy and banking system

Question 63

The degree to which people accept inequality in organizations and social situations is known as power distance.

Question 64

Philippe is from the Mediterranean coast of Greece and Sasha is from Iran.In their grocery store,this married couple is used to focusing on one task at a time rather than multitasking.This focused work habit by Philippe and Sasha is based on polychronic time.

Question 65

According to Rosabeth Moss Kantor of the Harvard Business School,the events that set up conditions for the global economy in the 1980s were when the ____.

A)Berlin Wall came down,countries worldwide opened their economies to foreign investors,and there was a worldwide trend of governments regulating their economies
B)Berlin Wall was built,Asian countries formed their own stock market,and NAFTA was implemented
C)Berlin Wall came down,Asian countries opened their economies to foreign investors,and there was a worldwide trend of governments deregulating their economies
D)governments of China and India considered implementing certain aspects of capitalism
E)Berlin Wall came down,and NAFTA and CAFTA were implemented

Question 66

Dawn grew up helping her father work on cars in his auto repair shop and developed into an excellent auto technician.Because of stereotypes regarding women in this field,she is interested in finding a shop that minimizes gender discrimination and role inequalities.This describes an organization that,according to the GLOBE project,is high in gender egalitarianism.

Question 67

Technology philosopher Nicholas Negroponte proposed that the global market driven by electronic information "_____."

A)causes products to become more expensive
B)increases diversity yet results in culture shock within organizations
C)results in new laws but less synergy and ethical behavior
D)causes increases in goods but decreases in product quality
E)forces things to get bigger and smaller at the same time

Question 68

Pat is concerned about better knowing the cultural tendencies of her business partners and competitors in Europe and Asia.Pat would be interested in knowing this information because according to the GLOBE project,this can give her a strategic competitive advantage.

Question 69

A small but groundbreaking committee,headed by Al Gore,that theorized global warming was known as the GLOBE project.

Question 70

Becoming a world citizen includes being global in focus and learning how _____.

A)to increase workplace diversity
B)not to be an "ugly American"
C)to increase synergy
D)to sing songs from other cultures and nations
E)to speak several languages

Question 71

Jamil,who is a successful salesperson,is interested in working for an organization that supports its employees and offers a compensation package based on performance improvement and excellence.This describes an organization that,according to the GLOBE project,is high in performance orientation.

Question 72

People first begin to learn their culture when they start utilizing social media,technology,such as the Internet,and watching television.

Question 73

Employers have found that there is agreement among most religions of the world as to what is the most important work-related value.

Question 74

The hallmark of great civilizations has been great systems of ____.

A)laws
B)diversity
C)leadership
D)communications
E)manufacturing

Question 75

Don,who owns an investment firm with customers worldwide,has witnessed how dangerous global economic interdependency can be.During a lunch meeting he mentioned to a customer,"I certainly have seen two negative effects for the United States of global economic interdependency: ___."

A)vast surplus funds from global investments flowing into the United States and loss of well-paying jobs
B)a huge surplus of funds from global investments flowing into the United States and huge cost increases
C)lack of global investments flowing into the United States and lower-quality goods
D)more expensive goods and bigger markets for American imports
E)fewer organizations utilizing MBO and poorer-quality goods

Question 76

Peter Agnefjäll,president and CEO of the IKEA Group,spends plenty of time with IKEA employees at all levels.This is an example of individualism/collectivism,which refers to the amount of time the managers,especially upper and middle management,spend with their employees.

Question 77

Don,a Texan,is a geologist employed with an oil drilling company who lives and works in Iran.Don is an example of a global-patriot.

Question 78

Last week Paul,CEO of Quality Furniture in South Carolina,traveled to Europe to visit customers.While overseas,Paul checked his e-mail daily and visited his company's website to show to customers.After visiting the last customer Friday morning,Paul was able to return to the corporate office to meet with his board of directors that night.This "shrinking" of time and space with air travel and electronic media defines ____.

A)the intranet
B)synergy
C)the small world philosophy
D)e-commerce
E)the global village

Question 79

People of different cultures have different ideas about what is acceptable interpersonal space and can carry a sexual connotation,such as men holding hands may raise eyebrows in the Middle East.

Question 80

After a morning of global cultural training,Marie,the vice president of marketing,was having lunch with Ann,who will be managing the new office in South Korea.Marie tells Ann,"There are cultural differences between the U.S.and South Korea that will affect the success of our office.For example,I suggest giving a couple of cans of Spam to your larger customers because Spam is considered elegant." Marie's advice to Ann is good,based on the fact that there are all kinds of cultural differences American managers have to get used to in other countries.