Question 1

When companies sell on the Internet,price becomes transparent,and price differentiation between countries declines.

Accepted Answer

When companies sell on the Internet, customers are easily able to compare prices across different countries, making price differentiation between countries less feasible. This is because information about prices is more readily available and accessible to consumers.

Question 2

A firm normally gets into international marketing simply by shipping out its goods.

Accepted Answer

Shipping out goods to other countries is the first step towards international marketing, as it involves exporting products to foreign markets. However, there are several other factors to consider for a firm to be successful in international marketing, such as adapting to local cultures, complying with foreign regulations, and developing effective marketing strategies for different countries.

Question 3

The ultimate form of foreign investment is direct ownership of foreign-based assembly or manufacturing facilities.

Accepted Answer

Direct ownership of foreign-based assembly or manufacturing facilities is known as foreign direct investment (FDI) and is considered the ultimate form of foreign investment as it allows the investor to have complete control over the operations and decision-making processes of the business in the foreign country.

Question 4

Research has shown that gray market activity is most effectively deterred when the penalties are severe,when manufacturers are able to detect violations or mete out punishments in a timely fashion,or both.

Accepted Answer

Research has shown that both severe penalties and timely detection/punishment by manufacturers are effective deterrents against gray market activities.

Question 5

The use of media may require international adaptation because media availability varies from country to country.

Accepted Answer

Media availability can vary due to differences in laws, regulations, technology, and infrastructure, among other factors. Therefore, adapting media strategies to the local context is essential to ensure effective communication and engagement with target audiences.

Question 6

People are often ethnocentric and favorably predisposed to their own country's products,unless they come from a less developed country.

Accepted Answer

This statement is true as people tend to have a bias towards products from their own country, also known as ethnocentrism. However, this bias may not necessarily apply to products from less developed countries, where people may perceive products from more developed countries as superior.

Question 7

Product adaptation involves altering the product to meet local conditions or preferences.

Accepted Answer

Product adaptation is the process of modifying a product to meet the local needs, preferences, and cultural differences of the target market. This includes changes to the design, packaging, features, colors, and even the name of the product. By adapting a product, companies can increase their chances of success in foreign markets and better cater to the needs of local consumers.

Question 8

Consumer behavior is highly consistent across different markets.

Accepted Answer

Consumer behavior can vary significantly across different markets due to differences in culture, values, beliefs, and economic conditions. Factors such as language, attitudes toward advertising, and brand preferences can also differ between markets, affecting consumer behavior. As a result, companies need to adapt their marketing strategies to each specific market to effectively reach and influence consumers.

Question 9

Product invention consist of creating something new.It can take two forms.Forward invention is reintroducing earlier product forms that are well adapted to a foreign country's needs.

Accepted Answer

Forward invention refers to creating new products for foreign markets, not reintroducing earlier product forms.

Question 10

Global marketers know that buyers hold distinct attitudes and beliefs about brands or products from different countries.These country-of-origin perceptions do not affect consumer decision making directly or indirectly.

Accepted Answer

Country-of-origin perceptions do affect consumer decision making both directly and indirectly.

Question 11

Attitudes toward country of origin are highly consistent over time and rarely change.

Accepted Answer

Attitudes toward country of origin can change over time due to various factors such as changes in political or social climate, personal experiences, and exposure to different cultures. However, some individuals may hold onto their attitudes towards a country of origin despite any changes that occur.

Question 12

Straight extension means introducing the product in the foreign market without any changes to the brand.

Accepted Answer

Straight extension refers to an approach in which the product is introduced in the foreign market without any modification to the brand. The product is essentially the same as the one offered in the domestic market.

Question 13

If the company adapts both the product and the communications,the company engages in dual adaptation.

Accepted Answer

Dual adaptation refers to the process of adapting both the product and the communication strategy to meet the needs and preferences of a specific market or target audience. Therefore, if a company adapts both the product and communications, they are engaging in dual adaptation.

Question 14

Distribution channels within countries can vary considerably.

Accepted Answer

Different regions within a country may have different infrastructures for distributing goods and services, which can lead to variability in distribution channels. Additionally, cultural and regulatory differences can impact distribution channels within a country.

Question 15

As required levels of distribution increase,so do customer prices relative to the importer's price.

Accepted Answer

As the levels of distribution increase, the product passes through several intermediaries which add their own markup to the price, leading to an increase in customer prices relative to the importer's price.

Question 16

The impact of country of origin is independent of the type of product.

Accepted Answer

The impact of country of origin can vary depending on the type of product. For example, a product that is perceived as having strong ties to a particular country, such as French wine, may be more influenced by its country of origin than a generic household item like a plastic container.

Question 17

When forces for both global integration and national responsiveness prevail to some extent,a "glocal" strategy that standardizes certain elements and localizes other elements can be the way to go.

Accepted Answer

When forces for both global integration and national responsiveness prevail, a "glocal" strategy that standardizes certain elements and localizes other elements can be the best approach to achieve a balance between global integration and local responsiveness. This allows companies to leverage global synergies while adapting to local cultures and preferences.

Question 18

The main disadvantage of direct investment is that the firm exposes a large investment to risks such as blocked or devalued currencies,worsening markets,or expropriation.

Accepted Answer

Direct investment involves a significant amount of capital investment in a foreign country, which exposes the firm to risks such as blocked or devalued currencies, worsening markets, or even expropriation. Therefore, the statement is true.

Question 19

Transfer prices can be set arbitrarily because,as an internal transaction,there are no financial implications to charging transfer prices that are too high or too low.

Accepted Answer

Transfer prices should not be set arbitrarily as they can impact the financial statements of the company, such as the profit and loss statement, balance sheet, and tax liabilities. If transfer prices are set too high, it can result in additional tax liabilities, while setting them too low can result in lower profits. Therefore, transfer prices should be set at fair market value to avoid any financial implications.

Question 20

Companies can run the same marketing communications programs as used in the home market or change them for each local market,a process called communication adaptation.

Accepted Answer

Companies can either run the same marketing communications programs or adapt them for each local market.

Quiz 21: Tapping into Global Markets