Question 1

________ is characterized by the acquisition of market share abroad and by increased sales.

Accepted Answer

A

Question 2

Of the following,which is NOT a proactive motivation to firms for international business?

Accepted Answer

Overproduction is not a proactive motivation for firms to engage in international business. In fact, overproduction is a problem that firms may face due to lack of demand in their domestic market or the inefficient use of resources. The other options (A, B, D, and E) are proactive motivations to engage in international business, as they offer unique advantages such as access to new markets, technology, information, and tax benefits.

Question 3

A measure resulting from the combination of physical and mental distance is known as ________.

Accepted Answer

Psychological distance is the term given to the measure resulting from the combination of physical and mental distance. It refers to the degree to which people perceive something as far or close, abstract or concrete, and uncertain or certain. It can impact decision-making and risk-taking behavior.

Question 4

The carrying out of the decision to export-- that is,the implementation of international business transactions--is the primary responsibility of the ________ department.

Accepted Answer

The answer of The carrying out of the decision to...

Question 5

________ refers to the firm's position compared to other firms in the industry,and,due to the benefits of international experience,is likely to grow.

Accepted Answer

Competitive strength refers to how well a firm can compete in the industry compared to other firms. The fact that the firm has international experience is likely to provide it with knowledge, skills, and advantages that can help it become more competitive and grow. Efficiency refers to how well a firm uses its resources to achieve its goals, profitability refers to how much money a firm makes after accounting for expenses, effectiveness refers to how well a firm achieves its objectives, and resourcefulness refers to a firm's ability to adapt and find new solutions to problems. While these factors can contribute to a firm's competitive strength, they do not directly refer to its position in the industry.

Question 6

According to the Focus on Entrepreneurship box in chapter 13,Dan Kelley,CEO of Tierra Dynamic Company,boosted international sales from zero to 25 percent of annual revenues.Of the following,what was most important in the international success of Tierra Dynamic Company?

Accepted Answer

The most important factor in the international success of Tierra Dynamic Company was that the company proactively went for the world instead of waiting for potential customers to seek out its products. This indicates that the company took a proactive approach and actively pursued international markets, which ultimately resulted in increased international sales.

Question 7

What are the two ways firms can be involved in exporting and importing?

Accepted Answer

Firms can be involved in exporting and importing through indirect methods, such as using intermediaries like export management companies or agents, or directly by establishing their own export/import departments or subsidiaries. Indirect methods may have lower risks and costs, but may also lead to less control and lower profits. Direct methods may require more resources and knowledge, but provide more flexibility and opportunities for growth.

Question 8

________ is manifested later by rising profitability.

Accepted Answer

Efficiency in operations or processes often leads to reduced costs and improved productivity, which in turn can result in higher profitability over time.

Question 9

Firms with ________ motivations go international because they want to; those with ________ motivations go international because they have to.

Accepted Answer

Firms with proactive motivations choose to go international to exploit opportunities or to expand, while those with reactive motivations are compelled to enter international markets due to competitive pressures, market demands, or other external factors.

Question 10

International activities may enable the firm to increase its output and therefore rise more rapidly on the learning curve.The Boston Consulting Group has shown that the doubling of output can reduce production costs up to ________ percent.

Accepted Answer

The Boston Consulting Group's experience curve concept suggests that costs can decrease by approximately 20-30% with each doubling of cumulative production, with 30% being a common figure cited.

Question 11

Research has shown that U.S.firms perceive Canada to be much closer ________ than Mexico.

Accepted Answer

U.S. firms perceive Canada to be much closer psychologically than Mexico due to cultural, linguistic, and economic similarities that make Canada feel more familiar and aligned with U.S. business practices and norms.

Question 12

XYZ Computer Company has been established as an international from its inception.It uses e-business on a regular basis to reach out to a large number of customers across the globe.XYZ Computer Company is a(n)________ firm.

Accepted Answer

The description of XYZ Computer Company as being established as an international firm from its inception and using e-business to reach a large number of customers across the globe, is characteristic of a born global firm. These firms are typically young and technology-driven, and pursue a global market from the beginning of their operations.

Question 13

Participation by a firm in international business through an intermediary,in which the firm does not deal with foreign customers or firms is called _________.

Accepted Answer

Indirect involvement refers to a situation where a firm participates in international business through an intermediary, such as an agent or a distributor, rather than dealing directly with foreign customers or firms. This approach can help to reduce transaction costs and risks associated with entering new markets.

Question 14

Sarah's Shoe Shack had plans to be strictly domestic.One day,a customer from France happened upon the Sarah's Shoe Shack corporate website and decided to place an international order.The firm has since grown and now exports to customers throughout Europe.Sarah's Shoe Shack can be called a(n)________.

Accepted Answer

Sarah's Shoe Shack did not have plans to export and only started exporting because of an accidental international order from a customer. Therefore, they can be classified as an accidental exporter. Option A - export management company, Option C - export trading company and Option E - sogoshosha involve deliberate and planned exporting activities. Option D - turnkey operation is unrelated to exporting activities.

Question 15

Firms that are most successful in international business are usually motivated by ________ factors.

Accepted Answer

Firms that are proactive in their approach to international business are usually the most successful, as they take the initiative to actively seek out opportunities and solutions to challenges in the global marketplace. This approach requires strategic planning, flexibility, and a willingness to take calculated risks, all of which can lead to increased competitiveness and profitability.

Question 16

Participation by a firm in international business in which the firm works with foreign customers or markets to establish a relationship is referred to as ________.

Accepted Answer

Direct involvement refers to a firm actively engaging in international business through establishing relationships with foreign customers or markets. This includes activities such as exporting, licensing, joint ventures, and foreign direct investment.

Options A and B are not relevant to the given scenario.

Option D refers to a payment made to a licensor or patent holder for the use of their intellectual property.

Option E refers to firms that establish a global presence from their inception or early stages of their development.

Question 17

An unplanned business opportunity that arises as a result of another firm's activities is known as:

Accepted Answer

Unsolicited orders refer to unexpected business opportunities that arise as a result of another company's actions, such as a customer placing an order without prior solicitation.

Question 18

Best Candy Company is located in Italy within 40 miles of the French border.The Italian company often does business with the French but does not perceive itself as going abroad since France is a neighboring country.Which of the following major reactive motivations is playing a role in the international activities of Best Candy Company?

Accepted Answer

Proximity to customers and ports is playing a role in the international activities of Best Candy Company. Since France is a neighboring country and within 40 miles of the Italian border, it is easier and more convenient for the company to do business with the French. Therefore, the company does not perceive itself as going abroad.

Question 19

What is the major proactive motivation to firms for international business?

Accepted Answer

Firms are primarily motivated to engage in international business to increase profits by accessing new markets, diversifying their revenue streams, and taking advantage of growth opportunities abroad.

Question 20

Satisfactory international performance can be achieved in three ways: ________,________,and ________.

Accepted Answer

Effectiveness refers to achieving the desired outcome or goal, efficiency means achieving the outcome with minimal waste or resources, and competitive strength refers to the ability to compete with other companies in the global market. These are the three key factors that contribute to satisfactory international performance.

Quiz 13: Entry and Expansion