Question 1

The majority of services enter foreign markets by licensing, franchising, or direct investment.

Accepted Answer

Licensing, franchising, and direct investment are common strategies for services to enter foreign markets, allowing them to expand their reach, adapt to local markets, and leverage local partners' expertise while managing risks and investments.

Question 2

A U.S. cosmetics company had to increase the SPF value of its sunscreen lotions marketed in the Middle East to provide more protection against UV radiation. Which requirement dictated the product adaptation?
A) legal
B) cultural
C) economic
D) climatic
E) political

Accepted Answer

The need to increase the SPF value of sunscreen lotions for the Middle East market is dictated by climatic requirements, as the region experiences intense sunlight and UV radiation levels.

Question 3

In countries with low literacy rates, the pictures and symbols on products are taken literally as instructions and information.

Accepted Answer

In countries with low literacy rates, pictures and symbols on products are often designed to be taken literally as they provide a universal means of understanding instructions and information, bypassing language and literacy barriers.

Question 4

A European chocolate manufacturer received several complaints from customers about the quality of its products when it began selling them in a tropical country. The firm had to repackage its chocolate bars with an extra plastic wrapper to protect it from the heat and dust. Which factor in the local market is most likely to have dictated the company's product adaptation in this scenario?
A) legal requirements
B) economic requirements
C) political requirements
D) climatic requirements
E) technological requirements

Accepted Answer

Climatic requirements are most likely to have dictated the company's product adaptation in this scenario, as the additional packaging was necessary to protect the chocolate bars from the heat and dust typical of a tropical climate.

Question 5

Services such as insurance and dry cleaning typically are classified as tangible.

Accepted Answer

Services such as insurance and dry cleaning are classified as intangible because they do not result in ownership of physical goods.

Question 6

Exercise Away Products found out it needed to shorten the legs of its treadmills sold in China owing to the height of the average Chinese person. By doing this, Exercise Away Products has achieved
A) product homologation.
B) global product standardization.
C) product dilution.
D) product obsolescence.
E) product disapprobation.

Accepted Answer

Product homologation refers to the process of certifying or approving a product to indicate that it meets regulatory standards and requirements within a particular country or market. By adjusting the height of its treadmills to better suit the average Chinese consumer, Exercise Away Products is effectively customizing its product to meet the specific needs and preferences of the local market, which is a form of product homologation.

Question 7

The support services component of the product component model contains such items as repair and maintenance and availability of spare parts.

Accepted Answer

The support services component of the product component model indeed includes elements like repair and maintenance services and the availability of spare parts, as these are essential for the ongoing use and satisfaction of the product.

Question 8

What are the two dimensions that define the quality of a product or service?
A) consumer choice quality and process quality
B) market-perceived quality and performance quality
C) product quality and market quality
D) actual quality and assumed quality
E) absolute quality and relative quality

Accepted Answer

Market-perceived quality refers to how consumers view the quality of a product or service, while performance quality refers to the actual performance and features of the product or service. These two dimensions together define the overall quality as experienced by the consumer.

Question 9

What is one of the top two criteria for global market consumers when making purchase decisions?
A) appearance
B) size
C) technology
D) quality
E) service

Accepted Answer

Quality is often one of the top criteria for consumers globally when making purchase decisions, as it directly impacts the perceived value and satisfaction derived from a product or service.

Question 10

What impact has global competition had on business activities in the international marketplace?
A) It has shifted the focus from a consumer's market to a seller's market.
B) It has increased product life cycles.
C) It has put more power in the hands of the customer.
D) It has reduced the competitive spirit of most businesses in a marketplace.
E) It has limited the choices of the consumers.

Accepted Answer

Global competition has empowered customers by providing them with more options and forcing businesses to be more responsive to their needs and preferences, thus putting more power in their hands.

Question 11

Cultural barriers play a bigger role in services than in merchandise trade.

Accepted Answer

Cultural barriers are more significant in services trade because services often require more direct interaction between provider and consumer, necessitating a deeper understanding of local customs, languages, and preferences compared to merchandise trade, which can be more standardized across different markets.

Question 12

Effective advertising and proper positioning of products can help brands to improve a less-than-positive country stereotype.

Accepted Answer

Effective advertising and proper positioning can highlight the quality and uniqueness of a brand's offerings, thereby helping to overcome negative stereotypes associated with a product's country of origin. This can change perceptions and improve the brand's image.

Question 13

Brand image is at the very core of business identity and strategy.

Accepted Answer

Brand image is crucial as it reflects the company's values, personality, and promise to its customers, influencing consumer perceptions and decision-making, thus being central to business identity and strategy.

Question 14

A television manufacturer in South Korea had to simplify its televisions before introducing them to the Nigerian markets, as the country lacked the skills to repair the product in case of a malfunction. The local salesforce also did not have the sufficient knowledge about the installation of the product. The requirement that is influencing product adaptation in this scenario is
A) legal
B) climatic
C) political
D) cultural
E) technological

Accepted Answer

By simplifying its television sets, South Korea has adapted its product to match the technological standards of the Nigerian market. Legal, economic, political, technological, and climatic requirements of the local marketplace often dictate product adaptation.

Question 15

Downward Dog Wines had to market its products with a different name in a foreign market as it was mandatory to translate the name into the local language. Which factor has most likely influenced the compulsory change of Downward Dog's product name in the foreign market in this scenario?
A) legal requirement
B) climatic requirement
C) technological requirement
D) monetary requirement
E) economic requirement

Accepted Answer

Legal requirements in a foreign market can mandate that product names be translated into the local language to ensure understanding and compliance with local laws and regulations.

Question 16

In the context of global marketing, a product's country of origin does not affect its brand's image significantly.

Accepted Answer

The country of origin can significantly affect a product's brand image, as consumers often associate certain qualities, standards, and expectations with products from specific countries. This perception can influence their purchasing decisions.

Question 17

Services are distinguished from products on the basis of their durability, homogeneity, and separability.

Accepted Answer

Services are distinguished from products primarily because they are intangible, inseparable from their production, not stored or transported, and their quality may vary with each delivery.

Question 18

Products from developing countries have the highest quality image.

Accepted Answer

Products from developing countries often struggle with quality perception issues compared to those from developed countries, largely due to factors like less advanced manufacturing technologies, quality control standards, and brand recognition.

Question 19

Bragster Bar, a brand of energy bars in Canada, sells its bars singly or in packs of two in South Asian markets instead of their regular multiple-item packaging that contains 10 or 20 bars. What requirement of the local market most likely influenced Bragster Bar's packaging decision?
A) legal
B) political
C) economic
D) technological
E) cultural

Accepted Answer

The decision to sell bars singly or in smaller packs is likely influenced by economic factors, as consumers in South Asian markets may have lower purchasing power and prefer to buy smaller quantities that are more affordable.

Question 20

Product ________ is the term used to describe the changes mandated by local product and service standards.
A) localization
B) protectionism
C) disapprobation
D) dilution
E) homologation

Accepted Answer

Homologation refers to the process of certifying that a product meets the regulatory standards and specifications required by a particular country or region.

Quiz 13: Products and Services for Consumers

The majority of services enter foreign markets by licensing, franchising, or direct investment.

A U.S. cosmetics company had to increase the SPF value of its sunscreen lotions marketed in the Middle East to provide more protection against UV radiation. Which requirement dictated the product adaptation?

In countries with low literacy rates, the pictures and symbols on products are taken literally as instructions and information.

Services such as insurance and dry cleaning typically are classified as tangible.

Exercise Away Products found out it needed to shorten the legs of its treadmills sold in China owing to the height of the average Chinese person. By doing this, Exercise Away Products has achieved

The support services component of the product component model contains such items as repair and maintenance and availability of spare parts.

What are the two dimensions that define the quality of a product or service?

What is one of the top two criteria for global market consumers when making purchase decisions?

What impact has global competition had on business activities in the international marketplace?

Cultural barriers play a bigger role in services than in merchandise trade.

Effective advertising and proper positioning of products can help brands to improve a less-than-positive country stereotype.

Brand image is at the very core of business identity and strategy.

Downward Dog Wines had to market its products with a different name in a foreign market as it was mandatory to translate the name into the local language. Which factor has most likely influenced the compulsory change of Downward Dog's product name in the foreign market in this scenario?

In the context of global marketing, a product's country of origin does not affect its brand's image significantly.

Services are distinguished from products on the basis of their durability, homogeneity, and separability.

Products from developing countries have the highest quality image.

Bragster Bar, a brand of energy bars in Canada, sells its bars singly or in packs of two in South Asian markets instead of their regular multiple-item packaging that contains 10 or 20 bars. What requirement of the local market most likely influenced Bragster Bar's packaging decision?

Product ________ is the term used to describe the changes mandated by local product and service standards.