Question 1

Consumers prefer globally branded products because branding provides a sense of trust and confidence in their purchasing.

Accepted Answer

Numerous studies have shown that consumers tend to prefer internationally recognized and established brands because they provide a sense of trust and confidence in the product quality and consistency.

Question 2

MNEs typically centralize transfer pricing under the direction of the chief financial officer at corporate headquarters.

Accepted Answer

This is generally accepted as a common practice in multinational enterprises (MNEs) as it allows for consistent application and monitoring of transfer pricing policies across different subsidiaries and jurisdictions.

Question 3

Adaptation is counterproductive in multidomestic industries.

Accepted Answer

Adaptation is necessary in multidomestic industries where each local market has different needs and preferences. Failure to adapt could result in a loss of market share and competitiveness.

Question 4

A standardized marketing approach is inappropriate when products have universal specifications.

Accepted Answer

A standardized marketing approach can be appropriate for products with universal specifications as the marketing mix (product, price, promotion, and place) can still be tailored to specific target markets and consumer preferences.

Question 5

The degree of control management desires over price setting in foreign markets is considered to be an important external factor affecting international pricing.

Accepted Answer

The degree of control management desires is an internal factor, not an external one, affecting international pricing decisions. External factors include market demand, competition, and economic conditions.

Question 6

Branding refers to the process of dividing a firm's total customer base into homogeneous clusters in a way that allows management to formulate unique marketing strategies for each group.

Accepted Answer

The answer of Branding refers to the process of dividing...

Question 7

Frequent business travelers, who are also affluent and eager spenders, represent a global market segment.

Accepted Answer

Frequent business travelers are an important global market segment as they tend to be more affluent and willing to spend money on travel-related expenses. They are also likely to have high levels of loyalty to certain airlines, hotels, and other travel companies, making them a valuable demographic for targeted marketing efforts.

Question 8

Commodities, industrial equipment, and technology products are difficult to standardize.

Accepted Answer

The answer of Commodities, industrial equipment, and technology products are...

Question 9

Prices do not affect customers' perception of value.

Accepted Answer

Prices do affect customers' perception of value. Customers often associate a higher price with a higher perceived value and may be willing to pay more for a product or service they perceive as more valuable. Additionally, a lower price may lead customers to perceive a product or service as cheap or of lower quality.

Question 10

A standardized marketing approach is appropriate when customers seek similar features in the product or service.

Accepted Answer

A standardized marketing approach means applying the same marketing strategy to all customers or groups of customers. This approach is appropriate when customers seek similar features in the product or service, as the marketing message and tactics can resonate with a large proportion of the target audience. However, when customers have different needs, preferences, behaviors, or characteristics, a differentiated or personalized marketing approach may be more effective in reaching and engaging them.

Question 11

The strength of a global brand is best measured by its brand equity.

Accepted Answer

Brand equity is the value and perception that a brand holds in the minds of consumers, including their loyalty, trust, and willingness to pay a premium for the brand's products or services. Thus, the strength of a global brand is best assessed by its brand equity.

Question 12

Global new-product planning teams formulate best practices that the firm implements in all its units worldwide.

Accepted Answer

Global new-product planning teams aim to establish standard best practices that can be implemented consistently across all units worldwide.

Question 13

Incremental pricing refers to setting prices to cover only the firm's variable costs, but not its fixed costs.

Accepted Answer

The answer of Incremental pricing refers to setting prices to...

Question 14

When an exporter gains a price advantage because its home-country currency is weakening relative to its customer's currency, then it should consider lowering the prices of its products.

Accepted Answer

The answer of When an exporter gains a price advantage...

Question 15

A firm can reduce its marketing and advertising costs substantially by focusing on numerous national brands instead of a single global brand.

Accepted Answer

Focusing on a single global brand can actually result in cost savings through economies of scale and consistent brand messaging. Using numerous national brands can lead to higher costs due to the need for customized marketing campaigns for each brand.

Question 16

Varying income levels among nations usually necessitate that firms make price adjustments and product modifications for individual markets.

Accepted Answer

Since income levels differ among nations, firms have to adjust their prices and products to suit individual markets. This is because what may be considered affordable or acceptable to one country may not be the same for another country.

Question 17

Adaptation refers to the process of making the marketing program elements uniform, with a view to targeting entire regions, or even the global marketplace, with the same product or service.

Accepted Answer

Adaptation refers to the process of modifying the marketing program elements to fit the specific needs and preferences of different regional or global markets. It's not about making them uniform.

Question 18

A reputed American automaker competes in the premium car market segment. It targets affluent buyers with refined tastes who would not mind paying several thousand dollars for a premium car. This is an example of positioning.

Accepted Answer

The description matches the definition of positioning, which involves targeting a specific market segment based on the needs and preferences of that segment. In this case, the automaker is targeting affluent buyers with refined tastes who are willing to pay more for a premium car.

Question 19

Rigid cost-plus pricing is typically favored by highly experienced exporters.

Accepted Answer

Rigid cost-plus pricing is not typically favored by highly experienced exporters as they tend to use more flexible pricing strategies that take into account market conditions and competition.

Question 20

In international business, marketing is concerned with identifying, measuring, and pursuing customer needs and market opportunities abroad.

Accepted Answer

This statement is true. Marketing in international business involves understanding and responding to customer needs and market trends in foreign markets.

Quiz 18: Marketing in the Global Firm