Deck 7: Selecting Foreign Markets

Question 1

One implication of the Uppsala model is that the smaller the psychic distance between the home and host countries the more likely it is that the firm will be successful in the new environment.

Answer 1

True

Question 2

Which theory has been criticized for its linear approach to the internationalization process?
(a) Uppsala model
(b) Transaction cost analysis
(c) Waterfall
(d) Dunning's OLI

Answer 2

A

Question 3

In the country selection process the objective of macro-segmentation is to develop and apply segmentation criteria which allow the marketing manager to screen a large number of potential candidate countries.

Answer 3

True

Question 4

With a _______________ internationalization strategy country selection is based on market potential and not psychic distance.
(a) Sprinkler
(b) Born global
(c) Waterfall
(d) Pragmatic entry mode

Question 5

Why would cultural distance have an impact on a firm's country selection decision?

Question 6

Define the term 'internationalization' and identify any three stages in the process.

Question 7

Distinguish between a waterfall and a sprinkler foreign market expansion strategy.

Question 8

Which of the following is considered a reactive motivation to go international?
(a) Profit advantage
(b) Saturated domestic markets
(c) Managerial urge
(d) Technological advantage

Question 9

It may be appropriate to combine country-level screening with screening at the consumer level because consumers who, because of their similarities, comprise a single segment may reside in different countries.

Question 10

Some companies may skip one or more stages in the process of internationalization e.g. transitioning from exporting directly to foreign production. What is this phenomenon called?
(a) A waterfall mechanism
(b) A sprinkler approach
(c) Leapfrogging
(d) Cascading

Question 11

What is the main purpose of conducting a site visit before selecting a country for market entry?
(a) Verify the company's specific advantages
(b) Build a factory
(c) Corroborate data used in the analysis
(d) Holiday for the managers

Question 12

What is the difference between reactive and proactive motivations for internationalization?

Question 13

One of the steps in the process of selecting foreign markets for entry is secondary screening. What is meant by the term 'secondary screening'?