Question 1

Which of the following do managers in a multinational firm at company headquarters typically prefer to emphasize in order to simplify decisions?
A) local consistency
B) local adaptation
C) global adaptation
D) global consistency

Accepted Answer

Managers in a multinational firm at company headquarters typically prefer to emphasize global consistency in order to simplify decisions. This means that the company has standardized policies and procedures that are applied universally across all locations, which helps to reduce complexity and increase efficiency. Local consistency and adaptation are generally more relevant for managers at the subsidiary level, who are responsible for adapting to the local market and cultural context. Global adaptation may be necessary in some cases, but it can also lead to increased complexity and reduced efficiency.

Question 2

Sodima is a French cooperative that owns the name,the trade secrets,and the patents on Yoplait yogurt.Ultima Foods pays Sodima for the right to sell Yoplait yogurt in Canada.What is this arrangement an example of?
A) licensing
B) a global joint venture
C) exporting
D) a strategic alliance

Accepted Answer

Licensing is defined as an agreement in which a domestic company,the licensor,receives royalty payments for allowing another company,the licensee,to produce the licensor's product,sell its service,or use its brand name in a specified foreign market.

Question 3

All global new ventures share two common factors.One factor is the bringing of a good or service to several different foreign markets at the same time.What is the other factor?
A) the development of culturally specific implementation policies
B) the company founders successfully developing and communicating the company's global vision from inception
C) a mechanistic organizational culture
D) the ability to respond quickly and efficiently to any changes in the external environment

Accepted Answer

Defining characteristics of the global new venture approach.

Question 4

The people who live on the island of Malta are described as happy-go-lucky people who are comfortable with an unstructured life and who deal well with sudden changes.According to Hofstede's cultural differences,which of the following characterizes the people of Malta?
A) a culture based on equity
B) a culture with a low degree of uncertainty avoidance
C) a culture based on inequity
D) a culture with a high degree of uncertainty avoidance

Accepted Answer

Uncertainty avoidance is defined as the degree to which people in a country are uncomfor with unstructured,ambiguous,unpredic situations.Here,the Maltese are described in a manner consistent with a low degree of this cultural dimension.

Question 5

T.I.P Ltd.was featured on the Discovery Channel for its ability to encapsulate very fragile natural items into a solid clear medium.After the Discovery Channel feature,T.I.P's customer base expanded beyond Canada.T.I.P started selling its products all over North America,Europe,Asia,and the Caribbean.What is T.I.P's expansion of sales to other countries an example of?
A) foreign direct investment
B) franchising
C) licensing
D) exporting

Accepted Answer

The definition of exporting-when companies produce products in their home countries and sell them to customers in foreign countries.

Question 6

What does the acronym GATT stand for?
A) Global Agreement on Temporal Trade
B) Governing Agreement on Trade and Transactions
C) General Agreement on Tariffs and Trade
D) Government Aid of Trade and Transactions

Accepted Answer

GATT stands for General Agreement on Tariffs and Trade.

Question 7

Much of China's sweater production comes from the city of Honghe.Half of the city's population produces 200 million sweaters that are distributed around the world.What does China use to distribute these sweaters?
A) franchising
B) direct investment
C) licensing
D) exporting

Accepted Answer

China uses exporting to distribute these sweaters around the world.

Question 8

What is the correct sequence for the phase model of globalization?
A) exporting; wholly owned affiliates; cooperative contracts; strategic alliances
B) exporting; cooperative contracts; wholly owned affiliates; strategic alliances
C) exporting; cooperative contracts; strategic alliances; wholly owned affiliates
D) exporting; strategic alliances; cooperative contracts; wholly owned affiliates

Accepted Answer

The correct sequence for the phase model of globalization is exporting, followed by cooperative contracts, then strategic alliances, and finally wholly owned affiliates. Option C follows this sequence.

Question 9

All global new ventures share two common factors.One factor is that the company founders successfully develop and communicate the company's global vision.What is the other factor?
A) the bringing of a good or service to several different foreign markets at the same time
B) the use of local adaptation strategy
C) a mechanistic organizational culture
D) the ability to respond quickly and efficiently to any changes in the external environment

Accepted Answer

Defining characteristics of global new venture,an approach in which new companies are founded with an active global strategy and have sales,employees,and financing in different countries.

Question 10

Ernst & Young,an international accounting and management consulting company,entered Hungary first by establishing a joint venture with a local firm.Ernst & Young later acquired the company with which it had the alliance.Which type of entity did Ernst & Young then have in Hungary?
A) a franchise
B) a licensing arrangement
C) a cooperative contract
D) a wholly owned affiliate

Accepted Answer

A wholly owned affiliate is defined as foreign offices,facilities,and manufacturing plants that are owned by the parent company.

Question 11

Which of the following regional trade agreements liberalizes trade between countries more than any other such agreement?
A) Maastricht Treaty of Europe
B) Association of South East Nations
C) Asia-Pacific Economic Cooperation agreement
D) North American Free Trade Agreement

Accepted Answer

The North American Free Trade Agreement (NAFTA) not only eliminates tariffs and other trade barriers on goods traded among the United States, Canada, and Mexico but also includes provisions for the liberalization of trade in services and investment. This level of liberalization is greater than that of the other regional trade agreements listed.

Question 12

What did the General Agreement on Tariffs and Trade (GATT)attempt to accomplish?
A) decreasing both tariff and nontariff barriers
B) eliminating taxes on trading goods between Canada, the United States, and Mexico
C) eliminating tariffs between China and Japan
D) protecting the exploitation of workers in third world countries

Accepted Answer

The General Agreement on Tariffs and Trade (GATT) aimed at reducing or eliminating trade barriers, including tariffs and nontariff barriers, to promote international trade.

Question 13

Historically,which of the following have most companies used to successfully enter foreign markets?
A) a phase model of globalization
B) a global new venture approach
C) a ripple approach
D) a market echo approach

Accepted Answer

The phase model is incremental in its approach to growing an international business,and was attractive because it increased risk/exposure to foreign markets gradually over time.

Question 14

What is a multinational company said to be acting with when it has offices,manufacturing plants,and distribution facilities in different countries and runs them all based on the same rules,guidelines,policies,and procedures?
A) policy certainty
B) global consistency
C) global adaptation
D) global certainty

Accepted Answer

When a multinational company has offices, manufacturing plants, and distribution facilities in different countries and runs them all based on the same rules, guidelines, policies, and procedures, it is said to be acting with global consistency. This approach ensures that the company maintains the same level of quality, standards, and values across all locations, which can help build a strong brand and reputation worldwide.

Question 15

Typically,what major question must a company answer once it has decided to go global?
A) How many additional employees will the company need?
B) To what extent should the company standardize or adapt business procedures?
C) To what extent should a company abide by global or regional trade agreements?
D) Will the organization's mission statement need to be changed?

Accepted Answer

The question of whether to follow a strategy of global consistency or local adaptation is fundamental to multinational business.

Question 16

Which of the following approaches tends to be most important to making an international business successful in any given country?
A) global consistency
B) local adaptation
C) domestic synergy
D) predetermined benchmarks

Accepted Answer

Local adaptation is more likely to be responsive to customer needs and tastes within a particular market.

Question 17

Which of the following are two kinds of cooperative contracts?
A) licensing and joint ventures
B) franchising and licensing
C) direct investment and indirect investment
D) direct exporting and indirect exporting

Accepted Answer

Franchising and licensing are two types of cooperative contracts that allow companies to collaborate without forming a new entity, sharing technology, trademarks, or business models under agreed terms.

Question 18

As Malta got ready for its admittance into the European Union (EU),the EU removed all taxes on the importation of goods manufactured in Malta.What was Malta preparing to become part of?
A) a zone of ethnocentricity
B) a regional trading zone
C) a neutral trading area
D) an international cartel

Accepted Answer

Regional trading zones are defined as areas in which tariff and nontariff barriers on trade are reduced or eliminated.

Question 19

What is the term for an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country?
A) exporting agreement
B) cooperative contract
C) joint venture
D) strategic alliance

Accepted Answer

Definition of a cooperative contract.

Question 20

Robert Mondavi Wineries entered into an agreement with Baron Philippe de Rothschild,owner of Bordeaux's First Growth chateau,to produce a top quality wine in California.What does the two companies working together to create a new product exemplify?
A) exporting
B) licensing
C) a joint venture
D) a cooperative contract

Accepted Answer

Example of a joint venture,defined as a strategic alliance in which two existing companies collaborate to form a third,independent company.

Quiz 8: Global Management

Which of the following do managers in a multinational firm at company headquarters typically prefer to emphasize in order to simplify decisions?

Sodima is a French cooperative that owns the name,the trade secrets,and the patents on Yoplait yogurt.Ultima Foods pays Sodima for the right to sell Yoplait yogurt in Canada.What is this arrangement an example of?

All global new ventures share two common factors.One factor is the bringing of a good or service to several different foreign markets at the same time.What is the other factor?

The people who live on the island of Malta are described as happy-go-lucky people who are comfortable with an unstructured life and who deal well with sudden changes.According to Hofstede's cultural differences,which of the following characterizes the people of Malta?

What does the acronym GATT stand for?

Much of China's sweater production comes from the city of Honghe.Half of the city's population produces 200 million sweaters that are distributed around the world.What does China use to distribute these sweaters?

What is the correct sequence for the phase model of globalization?

All global new ventures share two common factors.One factor is that the company founders successfully develop and communicate the company's global vision.What is the other factor?

Ernst & Young,an international accounting and management consulting company,entered Hungary first by establishing a joint venture with a local firm.Ernst & Young later acquired the company with which it had the alliance.Which type of entity did Ernst & Young then have in Hungary?

Which of the following regional trade agreements liberalizes trade between countries more than any other such agreement?

What did the General Agreement on Tariffs and Trade (GATT) attempt to accomplish?

Historically,which of the following have most companies used to successfully enter foreign markets?

What is a multinational company said to be acting with when it has offices,manufacturing plants,and distribution facilities in different countries and runs them all based on the same rules,guidelines,policies,and procedures?

Typically,what major question must a company answer once it has decided to go global?

Which of the following approaches tends to be most important to making an international business successful in any given country?

Which of the following are two kinds of cooperative contracts?

As Malta got ready for its admittance into the European Union (EU) ,the EU removed all taxes on the importation of goods manufactured in Malta.What was Malta preparing to become part of?

What is the term for an agreement in which a foreign business owner pays a company a fee for the right to conduct that business in his or her country?

Robert Mondavi Wineries entered into an agreement with Baron Philippe de Rothschild,owner of Bordeaux's First Growth chateau,to produce a top quality wine in California.What does the two companies working together to create a new product exemplify?