Question 1

Cajun Chicken, a growing franchise chain based in Lafayette, Louisiana, has expanded to 185 locations in the United States. Because they realize that domestic growth is limited, the owners are contemplating expansion to selected foreign countries. Thus far, research has shown that the rights to use many of the firm’s recipes can be sold to other restaurants, cafeterias, and food stores. Cajun can also sell prepackaged food products, complete with spices, to other markets. At this point, whether to start by opening company-owned outlets or selling franchises is still a toss up. In any case, the long-term picture looks good.
-RJR Nabisco (a U.S.company)allows a company in Singapore to use its brand name and recipe to produce and sell one of its products- Planters Nuts.In return RJR Nabisco receives a royalty fee.This type of international arrangement is called _______

Accepted Answer

This arrangement is called licensing because RJR Nabisco is allowing another company to use its brand name and recipe in exchange for a royalty fee, which is a typical setup in licensing agreements.

Question 2

According to some experts,American businesspeople are at a competitive disadvantage when they're prohibited from giving bribes or undercover payments to foreign officials or businesspeople.

Accepted Answer

Some experts argue that American businesspeople are at a competitive disadvantage in regions where bribes and undercover payments are a common practice for securing business deals, as U.S. laws, such as the Foreign Corrupt Practices Act (FCPA), prohibit such activities.

Question 3

In many countries,American firms may be at a disadvantage in competing with local companies because only the educated classes speak English.

Accepted Answer

American firms may face challenges in countries where English is not widely spoken, as their operations and communications are primarily in English, which may not be understood beyond the educated classes who are more likely to be proficient in English. This can put American firms at a disadvantage compared to local companies that operate in the local language and have a better understanding of local market nuances.

Question 4

The Foreign Corrupt Practices Act,which prohibits the distribution of bribes,can put American businesspeople at a competitive disadvantage.

Accepted Answer

The Foreign Corrupt Practices Act (FCPA) prohibits U.S. companies and individuals from bribing foreign officials to obtain or retain business, which can put them at a competitive disadvantage in countries where such practices are common and competitors from other countries may not be subject to similar restrictions.

Question 5

Cajun Chicken, a growing franchise chain based in Lafayette, Louisiana, has expanded to 185 locations in the United States. Because they realize that domestic growth is limited, the owners are contemplating expansion to selected foreign countries. Thus far, research has shown that the rights to use many of the firm’s recipes can be sold to other restaurants, cafeterias, and food stores. Cajun can also sell prepackaged food products, complete with spices, to other markets. At this point, whether to start by opening company-owned outlets or selling franchises is still a toss up. In any case, the long-term picture looks good.
-Even if Cajun opens company-owned restaurants in a foreign country,it may have to buy local food products to supplement the menu;in fact,it may have to buy chicken from local producers for the standard menu.In doing so,the company would be engaged in _____.

Accepted Answer

Outsourcing is the process of contracting with a third-party provider to perform a specific business function or service. In this case, Cajun Chicken is considering outsourcing the production of its chicken to local producers.

Question 6

When researching global business opportunities,firms must grasp the cultural,legal,economic,and _____ differences between the home country and the host country.

Accepted Answer

Political differences are crucial for firms to understand as they can significantly impact business operations, regulations, and the overall business environment in the host country.

Question 7

The _____ prohibit(s)the distribution of bribes and other favors among American businesspeople conducting business with foreign officials and businesspeople.

Accepted Answer

The Foreign Corrupt Practices Act (FCPA) specifically targets the issue of bribery and unethical practices in international business, prohibiting American companies and individuals from making corrupt payments to foreign officials for the purpose of obtaining or retaining business.

Question 8

Although different countries have different communication styles,virtually all cultures share a basic core of expression values.

Accepted Answer

The answer of Although different countries have different communication styles,virtually...

Question 9

Cajun Chicken, a growing franchise chain based in Lafayette, Louisiana, has expanded to 185 locations in the United States. Because they realize that domestic growth is limited, the owners are contemplating expansion to selected foreign countries. Thus far, research has shown that the rights to use many of the firm’s recipes can be sold to other restaurants, cafeterias, and food stores. Cajun can also sell prepackaged food products, complete with spices, to other markets. At this point, whether to start by opening company-owned outlets or selling franchises is still a toss up. In any case, the long-term picture looks good.
-If Cajun Chicken opens company owned stores and restaurants in Europe,it will be engaged in _____.

Accepted Answer

Opening company-owned stores and restaurants in Europe involves establishing physical business operations in a foreign country, which is classified as foreign direct investment (FDI).

Question 10

A reliable banking system,a strong stock market,and a government that discourages corruption while encouraging investment and competition are all conducive to economic growth.

Accepted Answer

These factors contribute to a stable and efficient financial environment, enhance investor confidence, and promote fair business practices, all of which are essential for sustainable economic growth.

Question 11

In high-context cultures,business-people don't need to know much about the personal life of a person in order to deal with him or her in a business setting.

Accepted Answer

In high-context cultures, understanding the personal background and establishing a relationship with the person is often important for successful business interactions.

Question 12

When researching global business opportunities,firms must grasp a variety of cultural,technological,economic,and political differences.

Accepted Answer

Understanding these differences is crucial for firms to successfully navigate and adapt their strategies in diverse global markets.

Question 13

When they started overseas operations,top managers at Keyboard Electronics had to learn to appreciate other countries' systems of shared beliefs,values,customs,and behaviors.In other words,they had to come to grips with elements of what is best characterized as the social environment.

Accepted Answer

The answer of When they started overseas operations,top managers at...

Question 14

Which of the following is not an argument given in support of U.S.headquartered multinational corporations (MNCs)?

Accepted Answer

The argument that U.S.-headquartered multinational corporations (MNCs) export American culture of movies, fast food, and mass-produced consumer goods to other countries is not typically presented as a direct support for MNCs. Instead, the primary arguments in support often focus on economic benefits such as delivering better and cheaper products (A), creating jobs (C), and raising the standard of living in developing countries (D). Exporting American culture is more of a byproduct of their global operations rather than a justification for their existence or expansion.

Question 15

If the U.S.dollar goes down relative to a foreign currency,foreign buyers pay more for American goods and services.

Accepted Answer

When the U.S. dollar weakens relative to a foreign currency, it means that the foreign currency can buy more dollars than before. This makes American goods and services cheaper for foreign buyers, not more expensive.

Question 16

A common method of protecting domestic goods and trade is to boycott offending nations at home and abroad.

Accepted Answer

Boycotting offending nations is not a common method of protecting domestic goods and trade; instead, governments typically use tariffs, quotas, and trade agreements to protect domestic industries and regulate international trade.

Question 17

Companies doing international business often face a smorgasbord of inconsistent laws and regulations.

Accepted Answer

Companies operating internationally must navigate a complex landscape of laws and regulations that can vary significantly from one country to another, leading to inconsistencies and challenges in compliance.

Question 18

Ben Franklin's adage "Time is money" is now a universally accepted principle.

Accepted Answer

The answer of Ben Franklin's adage "Time is money" is...

Question 19

When Whitlock Clothiers began overseas operations,top management had to learn to appreciate the _____ environments of other countries-that is,other people's systems of shared beliefs,values,customs,and behaviors.

Accepted Answer

The correct term is "cultural" because it refers to systems of shared beliefs, values, customs, and behaviors, which are key components of a culture.

Question 20

What's the international language of business?

Accepted Answer

English is widely recognized as the international language of business, used in global commerce, international diplomacy, and as a primary language in many international organizations.

Quiz 9: Business in a Global Environment