Deck 4: Managing in the Global Environment

Question 1

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

Answer 1

False
Explanation: If organizations already in the task environment are large and enjoy significant economies of scale,their costs are lower than the costs that potential entrants will face,and newcomers will find it expensive to enter the industry.

Question 2

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

Answer 2

False
Explanation: When new competitors enter an industry,competition increases,and prices and profits decrease.

Question 3

Demographic forces in the environment include changes in characteristics of a population,such as gender and race.

Answer 3

True
Explanation: Demographic forces are outcomes of changes in,or changing attitudes toward,the characteristics of a population,such as age,gender,ethnic origin,race,sexual orientation,and social class.

Question 4

The suppliers,distributors,and the wide-ranging demographic,political,and legal forces that affect the organization's ability to obtain inputs and to sell outputs are known as the general environment.

Question 5

Low levels of unemployment and increasing interest rates give people less money to spend.

Question 6

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 7

Poor economic conditions make environments more complex,and managers' jobs become more difficult and demanding.

Question 8

All societies are substantially the same in social structure.

Question 9

Groups that buy goods that another organization produces are known as customers.

Question 10

Cost advantages associated with large operations are called economies of scale.

Question 11

Today,global exchanges are becoming so complex that some companies specialize solely for managing other companies' global supply chains.

Question 12

The higher the barriers to entry in an industry,the more difficult it is to enter the task environment of that industry.

Question 13

The ability of employees to work by telecommuting is an example of a change in the demographic environment.

Question 14

An organization's competitors are those organizations that try to sell their goods to the same customers to whom the organization is trying to sell its goods.

Question 15

Rivalry between companies is the least threatening force that managers must deal with.

Question 16

The customers,competitors,and the technological,sociocultural,and global forces that affect the organization are known as the task environment.

Question 17

Organizations that help other organizations to sell their goods and services are known as suppliers.

Question 18

For the typical manager,opportunities and threats that result from changes in the task environment are more difficult to identify than events in the general environment.

Question 19

Higher the barriers to entry in an industry,greater is the threat of competition.

Question 20

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

Question 21

Societies in which inequalities are allowed to persist over time have low power distance.

Question 22

Societies that have a nurturing orientation place high value on success and competition.

Question 23

Organizations changing their work environment due to concerns relating to safety are an example of demographic forces that can challenge organizations.

Question 24

Human capital is the flow of power and influence around the world using persuasion,aggression,and force of arms to protect a country's or world region.

Question 25

In societies that have high power distance,the gap between the rich and the poor gradually grows smaller.

Question 26

The setup of "free-trade areas" increases the prices of manufactured products.

Question 27

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 28

Decentralization may help an organization respond effectively to local conditions,but may eventually harm the organization's performance.

Question 29

A tax that a government imposes on an imported good is known as a tariff.

Question 30

FTAA is seen as a stepping-stone toward establishing the CAFTA.

Question 31

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

Question 32

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

Question 33

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

Question 34

Societies that have an achievement orientation place high value on the quality of life of people and their interpersonal relationships.

Question 35

In July 2005,the U.S.House of Representatives approved the formation of NAFTA,a regional trade agreement designed to eliminate tariffs on products moving between Mexico,Canada,and the United States by 2004.

Question 36

Societies that are low on uncertainty avoidance,such as Japan,are skeptical about people whose behaviors differ from the established norm.

Question 37

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 38

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

Question 39

A society's values are merely abstract concepts.

Question 40

The things that a society considers to be good and right are known as the values of that society.

Question 41

The citizens of the United States and France tend to spend more and save less.

Question 42

Organizations that are not currently selling goods in a particular task environment but which could choose to enter this environment if they wanted to are known as:

A) suppliers.
B) potential competitors.
C) potential distributors.
D) competitors.
E) distributors.

Question 43

Economies of scale,brand loyalty,and government regulations that impede access can lead to ______________.

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

Question 44

A society that has a short-term orientation places high value on persistence in the achievement of goals.

Question 45

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

A) Economies of scale
B) Technological barriers
C) Administrative barriers
D) Government regulations
E) Brand loyalty

Question 46

When a firm that has not traditionally been a competitor of EcoPro suddenly creates a new type of product that makes the products of EcoPro obsolete,this is an example of which type of force in the environment?

A) General environment
B) Task environment
C) Economic environment
D) Legal environment
E) Political environment

Question 47

Organizations that produce goods that are similar to another organization's goods are known as:

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

Question 48

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
E) general

Question 49

Which of the following statements accurately defines brand loyalty?

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

Question 50

A supplier's bargaining position is strong when:

A) the input is vital to the organization.
B) there are a large number of suppliers as the source of an input.
C) the supply is free.
D) the supply is not protected by a patent.
E) alternate resources can be substituted for their specific supply.

Question 51

With Dell Computer,the actions of suppliers,distributors,customers,and competitors affect their managers' ability to obtain resources and dispose of outputs,and thus,have a significant impact on ______________.

A) the legal environment
B) the political environment
C) short-term decision making
D) demographics
E) the sociocultural environment

Question 52

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

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

Question 53

For Dell Computer,the educational institutions that train future Dell employees are its:

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

Question 54

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
E) Wholesalers

Question 55

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
E) global downsizing

Question 56

The cost advantages that are associated with large operations are known as:

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

Question 57

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

A) competitors'
B) micro
C) near
D) task
E) general

Question 58

A culturally diverse management team can be a source of strength for an organization participating in the global marketplace.

Question 59

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

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

Question 60

Factors that make it difficult and costly for a company to enter a particular task environment or industry (is)are ______________.

A) political forces
B) barriers to entry
C) demographic forces
D) barriers to exit
E) power distance

Question 61

Social structure is:

A) the set of values that a society considers important.
B) the traditional system of relationships established between people and groups in a society.
C) the hierarchical arrangements of people in society.
D) a collection of human beings.
E) an outcome of changes in,or changing attitudes toward,the characteristics of a population.

Question 62

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) inflation.
C) competitive advantage.
D) technology.
E) the general environment.

Question 63

In an organization's general environment,inflation is an example of a(an)__________________ force.

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

Question 64

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

A) Political and legal
B) Technological
C) Sociocultural
D) Economic
E) Demographic

Question 65

In the context of the global general environment,which of the following accurately defines economic forces?

A) They refer to the situation in an economy in which the distribution of resources among the people is considered fair.
B) They refer to pressure emanating from the social structure of a country or society or from the national culture.
C) They refer to the factors impacting the process of predicting the movements of the economy.
D) They are the interest rates,inflation,unemployment,economic growth,and other factors that affect the general health and well-being of a nation.
E) They are policies,decisions,or events that produce a microeconomic effect on commerce,employment,or incomes.

Question 66

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) the task environment.
E) demographic forces.

Question 67

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

A) sanction.
B) free-trade tax.
C) quota.
D) embargo.
E) tariff.

Question 68

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) Economic
E) Demographic

Question 69

The values,norms,knowledge,beliefs,moral principles,laws,customs,and other practices that unite the citizens of a country are known as ______________.

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

Question 70

In the United States individualism is highly valued,and in Korea and Japan individuals are expected to conform to group expectations.In the context of the general environment,this is an example of a(n)__________________ force.

A) demographic
B) power distance
C) sociocultural
D) individual
E) political

Question 71

If the product of a major competitor has a large share of the existing market for that product,then that product has a high level of:

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

Question 72

Since 1948,the decline in tariff barriers achieved among the governments of developed countries fell from over 40 percent to about __________________ percent in 2000,causing a dramatic increase in world trade.

A) 20
B) 14
C) 7
D) 3
E) 0

Question 73

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

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

Question 74

Changes in the work patterns of women result in a larger percentage of mothers with children under the age of five working outside the home.In the context of general environment,this is an example of which of the following forces?

A) Sociocultural
B) Task
C) Economic
D) Political
E) Demographic

Question 75

Which of the following trade agreements was passed by the U.S.House of Representatives to eliminate tariffs on products between the United States and all countries in Central America?

A) General Agreement on Tariffs and Trade (GATT)
B) North American Free Trade Agreement (NAFTA)
C) Central American Free Trade Agreement (CAFTA)
D) Free Trade Area of the Americas (FTAA)
E) World Trade Organization (WTO)

Question 76

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 being imposed by the U.S.government?

A) An export tariff
B) An import tariff
C) A franchise tax
D) A licensing tax
E) A joint venture tax

Question 77

Companies from the nation of Atlantis are more efficient in the production of certain types of apparel,while companies from the U.S.are more efficient in the production of certain types of computers.Which economic theory predicts that capital would move to Atlantis and be invested there to produce apparel,while capital from around the world would flow to the United States and be invested in its innovative computer software companies?

A) GATT
B) NAFTA
C) The free-trade doctrine
D) Collectivism
E) Individualism

Question 78

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) Legal
D) Demographic
E) Sociocultural

Question 79

Thirty percent of the customers of Action Group purchase Action Group's product three-fourths of the time that they purchase this type of product.In the context of barriers to entry,this product has a large degree of:

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

Question 80

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 to be abolished by the year 2004?

A) 30 percent
B) 50 percent
C) 70 percent
D) 90 percent
E) 99 percent