Question 1

Worldwide innovation and learning forces that are encountered by MNEs are driven by factor costs.

Accepted Answer

(It is mainly driven by the simultaneity of the globalizing and localizing forces, in general, and the increasing cost of R&D coupled with shortening life cycles of technologies and the products they spawn, in particular.)

Question 2

A firm's decision with respect to whether it should adopt a global, multinational or international strategy should be made without any consideration of the industry in which the firm operates.

Accepted Answer

(An industry's (a) economic forces of globalization, (b) national, cultural, social, and political forces of localization, and (c) technological and diffusion forces of innovation are central determinants for whether to adopt a global, multinational or international strategy.)

Question 3

What are the main forces that drive MNEs such as Nokia, the mobile communications company, to innovate and learn on a global scale?
A) Economic and political forces.
B) Political and social forces.
C) Social and informational forces.
D) Technological and informational forces.

Accepted Answer

(a, b, and c are incorrect because political forces and social forces are forces for local differentiation and responsiveness.)

Question 4

A global industry is characterized by low national responsiveness and high global integration.

Accepted Answer

This is because a global industry is focused on producing standardized products and services that can be sold globally, which requires high levels of global integration. National responsiveness is less important in this context because the industry is not adapting its products to local markets.

Question 5

Globalization is a phenomenon that took most industries by surprise.

Accepted Answer

(For most industries globalization was simply the latest change in economic, technological, and competitive factors over the past 100 years)

Question 6

Local responsiveness forces encountered by MNEs include cultural differences, government demands and economies of scope.

Accepted Answer

(Economies of scope is part of 'global integration and coordination forces'.)

Question 7

An industry that is characterized by low national responsiveness and high global integration is a(n)
A) multinational industry.
B) global industry.
C) international industry.
D) transnational industry.

Accepted Answer

A global industry is characterized by low national responsiveness and high global integration, meaning that companies compete by offering standardized products and services on a worldwide basis.

Question 8

A transnational industry is characterized by moderate national responsiveness and moderate global integration.

Accepted Answer

(A transnational industry is characterized by high national responsiveness and high global integration.)

Question 9

Philips, a multinational electronics corporation based in the Netherlands and diversified in the consumer electronics, domestic appliance, lighting, medical systems and medical technology industries would encounter the following forces of local responsiveness:
A) Cultural differences, government demands, and economies of scope
B) Cultural differences, government demands and factor costs
C) Cultural differences, government demands, and local competitors
D) Cultural differences, government demands, and increasingly liberalized trade environments

Accepted Answer

(a, b, and d are incorrect because economies of scope, factor costs, and increasingly liberalized trade environments are part of 'global integration and coordination forces'.)

Question 10

An international industry is characterized by low national responsiveness and moderate global integration.

Accepted Answer

(An international industry is characterized by moderate national responsiveness and moderate global integration.)

Question 11

A multinational industry is characterized by low national responsiveness and high global integration.

Accepted Answer

(A multinational industry is characterized by high national responsiveness and low global integration.)

Question 12

The pressures that drive book publishers such as McGraw-Hill to integrate and coordinate their activities across national boundaries are primarily _________.
A) Economic
B) political
C) social
D) organizational

Accepted Answer

(Forces for global integration and coordination are primarily economic rather than political, social, or organizational.)

Question 13

Global integration and coordination forces encountered by MNEs include economies of scale, government demands, and the expanding spiral of globalization.

Accepted Answer

(Government demands are part of the 'forces for local differentiation and responsiveness'.)

Question 14

The three conflicting environmental forces that MNEs encounter are cross-border integration and coordination, national differentiation and responsiveness, and worldwide innovation and learning.

Accepted Answer

These three conflicting environmental forces are commonly recognized in the literature on multinational enterprises (MNEs). Cross-border integration and coordination refer to the pressures to standardize and integrate operations across national borders, while national differentiation and responsiveness refer to the pressures to adapt to local differences in markets, institutions, and cultures. Worldwide innovation and learning refer to the pressures to leverage global knowledge and capabilities to create new knowledge and to transfer knowledge across national and organizational boundaries. These three forces can create tensions and trade-offs for MNEs as they try to balance global integration with local responsiveness and innovation.

Question 15

A multinational industry is characterized by ____________.
A) low national responsiveness and low global integration
B) low national responsiveness and high global integration
C) high national responsiveness and low global integration
D) high national responsiveness and high global integration

Accepted Answer

The answer of A multinational industry is characterized by ____________.
A)...

Question 16

What are the main forces that motivate MNEs such as Dell Computers to disaggregate their operations and activities to respond to national, regional and local needs and demands?
A) Social and economic forces.
B) Social and political forces.
C) Political and economic forces.
D) Economic and psychological forces.

Accepted Answer

(Forces for local differentiation and responsiveness are mainly social and political. They are not always economic because many times they make MNEs less efficient.)

Question 17

MNEs from emerging markets seem to be more poorly equipped to compete in other emerging markets when compared to their counterparts from developed markets.

Accepted Answer

(Increasingly, it is MNEs from emerging markets that seem best equipped to compete in other emerging markets. This is due in part to the experience they already possess in dealing with customers with similar income levels as well as with markets with similar institutions.)

Question 18

The search for global competitiveness is a major source of conflict between MNEs and host governments.

Accepted Answer

(Although MNEs and host governments might be partners in the search for global competitiveness, the former strives to achieve this objective within its global system, whereas the latter tries to capture it within its national boundaries.)

Question 19

Which global integration and coordination forces would MNEs, such as Mercedes-Benz, encounter?
A) Economies of scale, increasingly liberalized trade environments and government demands
B) Economies of scope, factor costs and increasingly liberalized trade environments
C) Economies of scale, expanding spiral of globalization and local competitors
D) Economies of scale, economies of scope and government demands

Accepted Answer

(a, c, and d are incorrect because government demands and local competitors are part of 'forces for local differentiation and responsiveness'.)

Question 20

In the emerging international environment, most industries can be categorized as multinational, global or international.

Accepted Answer

(In the emerging international environment there are fewer and fewer examples of pure global, textbook multinational or classic international industries. Instead more and more businesses are driven to a greater or lesser extent by simultaneous demands for global efficiency, national responsiveness, and worldwide innovation. These are the characteristics of what we call a transnational industry . .)

Quiz 2: Understanding the International Context: Responding to Conflicting Environmental Forces

Worldwide innovation and learning forces that are encountered by MNEs are driven by factor costs.

A firm's decision with respect to whether it should adopt a global, multinational or international strategy should be made without any consideration of the industry in which the firm operates.

What are the main forces that drive MNEs such as Nokia, the mobile communications company, to innovate and learn on a global scale?

A global industry is characterized by low national responsiveness and high global integration.

Globalization is a phenomenon that took most industries by surprise.

Local responsiveness forces encountered by MNEs include cultural differences, government demands and economies of scope.

An industry that is characterized by low national responsiveness and high global integration is a(n)

A transnational industry is characterized by moderate national responsiveness and moderate global integration.

Philips, a multinational electronics corporation based in the Netherlands and diversified in the consumer electronics, domestic appliance, lighting, medical systems and medical technology industries would encounter the following forces of local responsiveness:

An international industry is characterized by low national responsiveness and moderate global integration.

A multinational industry is characterized by low national responsiveness and high global integration.

The pressures that drive book publishers such as McGraw-Hill to integrate and coordinate their activities across national boundaries are primarily _________.

Global integration and coordination forces encountered by MNEs include economies of scale, government demands, and the expanding spiral of globalization.

The three conflicting environmental forces that MNEs encounter are cross-border integration and coordination, national differentiation and responsiveness, and worldwide innovation and learning.

A multinational industry is characterized by ____________.

What are the main forces that motivate MNEs such as Dell Computers to disaggregate their operations and activities to respond to national, regional and local needs and demands?

MNEs from emerging markets seem to be more poorly equipped to compete in other emerging markets when compared to their counterparts from developed markets.

The search for global competitiveness is a major source of conflict between MNEs and host governments.

Which global integration and coordination forces would MNEs, such as Mercedes-Benz, encounter?

In the emerging international environment, most industries can be categorized as multinational, global or international.