Question 1

Adam's Apple Corporation ships all of the apples from its orchards in Washington to a single buyer in Japan.The firm's entire profits are derived from this international transaction.Adam's Apple Corporation:

Accepted Answer

Adam's Apple Corporation is not a multinational corporation as it only operates in one country (the United States) and engages in a single international transaction.

Question 2

__________ is the exchange of merchandise or services for other merchandise or services without the exchange of money.

Accepted Answer

Bartering is the process of exchanging goods or services directly without the use of money. This concept has been around for centuries and is still prevalent in many parts of the world. In a barter system, individuals or businesses trade one product or service for another product or service of equal value. This can be beneficial when a person or business is short on cash but has something of value to trade.

Question 3

Due to a nation's weak currency,people may have to fall back on ____________.

Accepted Answer

When a nation's currency is weak, it may become difficult for its citizens to import goods from other countries due to the high exchange rate. In such cases, they may opt for bartering, which means exchanging goods or services for other goods or services without the use of money. This allows them to acquire what they need without having to spend large sums of money on imports that are now more expensive due to the weak currency.

Question 4

____________ describes an attitude held by some American business people that American culture is superior to all others.

Accepted Answer

Ethnocentricity describes the attitude of believing that one's own culture is superior to all others. This can lead to a lack of understanding and appreciation for other cultures, which can ultimately harm business relationships and opportunities.

Question 5

The Dabble Corporation wants to begin exporting its products.The company needs advice about how to get started,as well as trade-finance support.The federal government has established _____________ to help companies like Dabble Corporation.

Accepted Answer

The Export Assistance Centers are federal government establishments specifically designed to provide advice and trade-finance support to companies that want to begin exporting their products. The World Trade Commission doesn't exist, and the Federal Reserve Banks deal with monetary policies and banking regulations. Export trading companies, on the other hand, are private entities that facilitate exports for a fee.

Question 6

In 2008,Emerson,Inc.reported that it owns and operates 265 companies worldwide with 23% of its sales coming from Europe,18% from Asia,46% from the U.S. ,and 13% from other parts of the world.Clearly,Emerson exemplifies ________________.

Accepted Answer

Emerson, Inc. exemplifies a multinational corporation, as it owns and operates multiple companies worldwide and generates sales from various regions across the globe. A sovereign wealth fund refers to a state-owned investment fund, which is not applicable to Emerson. A foreign subsidiary is a company that is controlled by a parent company in a foreign country, which may not be the case for Emerson. An expropriated organization refers to a company that has been taken over by the government without compensation, which is not applicable to Emerson.

Question 7

Nike _________________ its products in foreign countries,where labor is cheap and production sites are owned by other companies.This strategy allows Nike to experiment in new markets without incurring large start-up costs involved with building their own production facilities.

Accepted Answer

Nike uses contract manufacturing to produce its products in foreign countries. This strategy allows them to minimize start-up costs and take advantage of the lower labor costs in these countries. The production sites are owned by other companies, and Nike contracts with them to manufacture their products.

Question 8

McHugh Corporation of Ireland and Enomoto Enterprises based in Japan recently produced a new electric car with rechargeable batteries that can be driven at high speeds for long distances.They have shared the investment,each contributing important technological expertise to the effort.These firms entered into an)____ to build this car.

Accepted Answer

A joint venture is a business agreement between two or more companies to work together on a specific project or venture, while retaining their own individual identities. In this case, McHugh Corporation and Enomoto Enterprises collaborating to produce a new electric car with their respective technological expertise is an example of a joint venture. The other options given, such as multinational cartel, industrial countertrade agreement, and multinational limited partnership, do not accurately describe the nature of the collaboration.

Question 9

Which of the following statements is the most accurate observation regarding multinational corporations?

Accepted Answer

The answer of Which of the following statements is the...

Question 10

Pepsi Cola entered into a long-term contract with a South African beverage company.The contract calls for the South African firm to produce and market Pepsi Cola in South Afric A.Pepsi will receive royalties on each case of beverage sold.This is an example of:

Accepted Answer

This is an example of licensing, as the South African company has been granted the right to produce and market Pepsi Cola in their country in exchange for paying royalties to Pepsi.

Question 11

Boasting a $1.6 billion Ketchup brand,the H.J.Heinz Company is flying high with a 44% increase in its sales of Indonesian based ABC,a soy sauce company that it owns.ABC is a _____________ of Heinz.

Accepted Answer

A foreign subsidiary is a company that is owned or controlled by a parent company in a foreign country. In this case, the H.J. Heinz Company owns ABC, which is based in Indonesia, making it a foreign subsidiary of Heinz.

Question 12

The Quinoa seed is in high demand in wealthier countries such as the U.S.and Japan.Approximately 97% of all Quinoa production comes from small farmers in Bolivia and Peru who farm at high elevations-8,000 feet or higher.The seed is considered highly nutritious.Mostly grown and harvested in Bolivia and Peru,and sold to markets in other countries,the seed is now considered an important __________ for these nations.The governments of Bolivia and Peru are hopeful that this product will increase the quality of life of their farmers.

Accepted Answer

Quinoa is sold to markets in other countries, which makes it an export. The governments of Bolivia and Peru are hopeful that this product will increase the quality of life of their farmers as it is highly nutritious and in high demand in wealthier countries.

Question 13

Which of the following sociocultural forces can have a significant impact on global business operations?

Accepted Answer

Religion can have a significant impact on global business operations as it influences consumer behavior, ethical considerations, and cultural norms in different parts of the world. For example, certain religions prohibit the consumption of certain products, such as beef or alcohol, which could affect product offerings and marketing strategies in those regions. Additionally, religious beliefs and practices may affect the workweek and holidays, which could impact business operations and scheduling.

Question 14

If a Swiss chocolate firm purchases an American ice cream manufacturer,the American ice cream manufacturer becomes a:

Accepted Answer

The American ice cream manufacturer becomes a foreign subsidiary because it has been acquired by a Swiss chocolate firm, which means that it is now under the control and ownership of a foreign entity.

Question 15

An article published in the journal of "Modern Healthcare" reported that in 2007,the governments of the following nations held sizeable investments in U.S.companies,including U.S.healthcare providers):  These investments are called _____________ and some experts fear that the strategy behind these governments sinking large amounts of capital in U.S.companies may have ____________________.

Accepted Answer

The investments made by these governments are known as Sovereign Wealth Funds (SWFs). Experts fear that such investments may have geopolitical objectives behind them, which could potentially harm U.S. interests.

Question 16

Which of the following terms describes the set of values,beliefs,rules,language,and institutions held by a specific group of people?

Accepted Answer

Culture refers to the set of values, beliefs, rules, language, and institutions held by a specific group of people. Ethnocentricity refers to the tendency to view one's own culture as superior to others, institutional society is not a commonly used term in sociology, and social myopia refers to a narrow focus on only one's own social world.

Question 17

Which of the following represents the value of one nation's currency relative to the currencies of another country?

Accepted Answer

Exchange rate represents the value of one nation's currency relative to the currencies of another country.

Question 18

Global financial markets operate under a system of ___________,where the supply and demand for various currencies dictate their value at any moment in time.

Accepted Answer

Floating exchange rates refer to the system where the value of a currency is determined by the market forces of supply and demand. This is the current system employed by most global financial markets. Living rates and foreign good rates are not commonly used terms in finance. Live trading rates could refer to real-time currency exchange rates but is not as specific as floating exchange rates.

Question 19

ExxonMobil Corporation refines and markets its petroleum products in many different nations.In addition,Exxon's stockholders and managers come from many different nations.If some of the nations where it operates decided to take over the assets of the company,this act would constitute:

Accepted Answer

Expropriation refers to the government seizing private property, including assets, without the owner's consent. If some of the nations where Exxon operates decided to take over the company's assets, it would be an act of expropriation. This can be a major risk for multinational corporations, as it can negatively impact their operations and profitability.

Question 20

Ethnocentricity means:

Accepted Answer

Ethnocentricity refers to the belief that your own culture is superior to others. This can lead to a lack of understanding and respect for other cultures, and can create conflict and prejudice.

Quiz 3: Doing Business in Global Markets